Mold in a house...
Mold in a house... DarrenTownsend/gettyimages.com

The listing for this house warns two types of buyers "Investors/Builders" that they must enter it at their own risk. And so one has two risks to consider when they walk into this Ballard home. One risk—which can be reduced by wearing a breathing mask—involves a type of mold that has yet to be determined by a specialist in such matters. The other is: will it make more money if one puts the huge amount of money it's asking for into it? The Investor/Builder is in a situation that's much like that scene in the opening of Alien. After receiving a signal, they have landed on a new world and must explore the unknown: a very pricey moldy home.

Though listed for $775K, Redfin is certain that a buyer can squeeze even more value out of it. How can this be anything but interesting? In its present condition, the place is no good for living in. Indeed, the price is not about the house (unlivable), but the value of its value: meaning, how much might it make in the future. It has already made so much in the past. Can it make more? The chances are still good even though it has mold that might make you sick.

But here is the interesting thing to really think about: Are the rising rents and housing prices about the local, booming economy? Is it all about Amazon? Or is there some other force at work? A chapter in IMF's recent report, Global Financial Stability Report April 2018 (PDF), points in the direction of the international economic forces and their role in regional real estate markets. The phenomenon it could not avoid noticing and presenting is that of synchronicity.

Home prices in major cities around the world are actually conforming, becoming more and more alike. And what this means in the extreme (and if a trend is not checked, its extreme is inevitable), that cities in the Third World and those in the Second and First World are converging. Soon, you will not need a passport to visit Dharavi. An ORCA card will do the trick.

From the opening of the IMF paper:

This chapter analyzes whether and how house prices move in tandem across countries and major global cities; that is, the synchronicity of global house prices. On the one hand, higher house price synchronization and deeper global links in housing markets may be beneficial. On the other hand, higher synchronization may be the result of global financial conditions influencing local house price dynamics and housing markets, thereby propagating local economic and financial shocks.

The paper basically points out all of the dangers that come with an absence of capital controls, but it offers no real solutions to these systemic risks. What is understood by the IMF is that there's no going back to the age it was founded to manage, the age when states protected their markets and employment (this happened between 1947 and 1971). The states of our times only ensure or enforce the freedoms of capital.

To see a fictional representation of this synchronization, watch the opening scene in the second episode of the webseries, An African City, which is an African Sex in the City ("The cost of any nice home in Accra [the capital of Ghana] is about the same cost of any nice home in Paris, London, and New York...")