"At the heart of the construction sector, a dangerous equation that is eroding the quality of our cities day by day—and is often ignored—is at play. On one side are the constantly increasing costs of zoned land, and on the other is the housing quality crushed under this cost. While landowners want to maximize the value of their property, we, as contractors, often resort to a dangerous formula just to meet that expectation. This vicious cycle, unfortunately, mortgages the future of our cities and the quality of our lives."
The problem primarily centers on land share agreements. This very issue in land share agreements also misdirects the price of sold land. A property owner whose land value increases naturally wants to receive the full equivalent of that value. However, a mistaken perception in the market suggests that this value is measured by the “maximum number of apartments possible.” There is a belief that the more units squeezed onto a plot of land, the more valuable the landowner's share will be. This is a misconception that ultimately damages the landowner, the contractor, and the home buyer in the long run.
When setting out with the goal of 'more apartments,' compromising on quality becomes inevitable. To fit more units onto the same plot, apartments shrink, social amenities and green spaces disappear, and cheaper materials and labor are preferred. The result is a pile of soulless, low-quality concrete slabs, all alike and far from offering living comfort. Yes, the landowner might own 15 apartments instead of 10 on paper. However, the total value of these 15 units may be less than the total value of 8 high-quality units that could have been built on the same land.
Let's not forget that more apartments does not mean more profit. Dozens of low-quality apartments are difficult to sell, their rental income is low, and their value does not increase over time; instead, it declines as they age. However, a smaller number of residences built with high-quality, spacious materials and featuring social amenities sell for a higher price and multiply their value over the years. This is real and sustainable profit.
Landowners should measure the value of their property not by the number of apartments or the high ratio they will receive, but by the quality and future potential of those units. Contractors, instead of surrendering to this dangerous equation, must educate landowners with the right vision. Because we should bring not just more buildings to our cities, but more qualified 'homes' where people can live happily and whose value will increase for generations. The true profit lies in this vision.
