Land rent

Mesopotamia was one of the oldest areas with agriculture. The green land was flooded by the rivers and consequently fertile. For scarce fertile land the farmer (the producer) payed a rent to the landowner (the asset owner).

Until the industrial revolution farm-land was the most important scarce asset, and therefore land rent was the most frequent type of rent.

In modern times urban land rents are important: they have much impact on house prices. An analogy to the old map is a modern city: land prices near the metro lines will be much higher than far-away locations. If a city decides to build a metro line the land prices nearby will increase very much, similar to agricultural land nearby rivers in old Mesopotamia.

metro line and house prices

In Amsterdam the M52 metro opened in 2018. It is also known as the North-South line as it connects the city north of the IJ-waterfront to the centre and the business district in the south. The opening of this line had a major impact on prices of land and houses in Amsterdam-North, which used to be an area for working families with low incomes.