Great technological change is coming and you need to know where those gains will manifest. That’s the only way you can position yourself to take advantage of it all.
One prime example: Mark Pivac and his company Fastbrick Robotics is positioned to redefine the global construction industry by developing the first fully automated bricklaying robot. Until now robots have required an on-site builder to assist with the operation.
Named Hadrian, this robot can work around the clock, day and night, laying 1,000 bricks per hour. That’s a new house every two days — something that takes its human equivalent 4–6 weeks of backbreaking work.
It’s all 3D computer aided and designed. Hadrian calculates where each brick should go and scans and cuts the bricks if they need to be re-shaped. Mortar under pressure is applied to the brick and no human contact is required. It can even leave spaces for wiring and plumbing.
But here’s the main point, many articles commenting on this revolutionary technology are suggesting that the significant cost reductions in construction will assist in promoting housing affordability. But as revolutionary as this technology is, this it cannot achieve.
Because it is not the cost of construction which can spiral out of control above the ability of wages to pay for it, but rather it is the land it sits on. And a better building technology simply will not solve that problem.
Land which is fixed in supply, will always sell at the red line — at what the economy can afford for that particular location. It doesn’t actually matter if the building costs come down. Land will take the gains eventually.
You must understand this. It will make you a better investor. You’ll start to see the huge potential gains that are coming for land prices and you can then work on a way of taking advantage of it all.
In a related story, last year a company in China called Winsun, showed that it can build ten 3D printed houses in just one day. The reported cost for each is just US$5,000. This is an absolute game changer for the cycle ahead. The company has even demonstrated the ability to construct a five story apartment building.
More news from China; an entrepreneur by the name of Zhang Yue and his company Broad Group are creating a revolution in building city office towers. What is startling about it is the speed at which his buildings are built. The office towers shoot up at an unheard of three storys per day. Assembled from thousands of factory made steel modules, the whole thing is slotted together like a Meccano set. His 57 story office tower dubbed ‘Mini Sky City’ with 19 atriums, office space for 4,000 people and 800 apartments took only 19 days to build.
Once it becomes cheaper to build, people can pay a little more for the land component…and so they will. We are just starting to get an inkling of the great technological gains that are coming this cycle. Once you understand what drives the cycle, you’ll stop listening to those talking of a property collapse, as many are doing, and start to focus on taking advantage of what may be the biggest real estate boom of all time.
The advances in building technology promised during this cycle look be stupendous. You can be absolutely certain land price will quickly start to factor in those future gains and owners will set their expectations accordingly.
Companies like Fastbrick, Winsun and Broad Group are in various stages of development. But it is a sign of things to come, and this trend can only send land prices higher.
The real estate cycle is turning right in front of you. This may be the biggest real estate cycle of all, dwarfing all others. Make sure you’re in a position to profit from it and time it all to your advantage.
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