econ random question!!!!?

Question

a new highway makes travel between a city and summer homes positioned along the highway substantially easier. accordingly, summer homes along this highway become more desirable. is it fair if rents are raised on summer homes there????? and why????

Answer 1

Markets do not distribute gains fairly, and government actions both contribute to the "unfairness" by building the road, and compensate for it by taxing the owners of the property on their increased income and property value. People profit and lose in all parts of economy due to events that they are not responsible for. It may not be fair, but it is life.

Edit:
If the road is built using property taxes on only the owners of the homes along the road, and not using funds from taxing other people then it is fair.
An average this is the case for urban areas where the owners of property pay to build the streets that lead to their houses thru property taxes. However highways are usually financed using a much broader tax base.

Answer 2

yes, because the highway adds value to the property.

If the area is desired more than another area that is away from the highway then why wouldn't rental rates be higher in the desirable area?

Answer 3

yes fair.

Road is built with property taxes on owners of the homes, so they deserve a return on their taxes.

If rents were kept the same, too many people would want to get in, then "scalpers" would rent early for cheap and then sublease to late-comers at same high price.