The Real Deal New York

A report for all the city’s (market) seasons

November 16, 2007
By Tom Acitelli

The chaplain at the federal penitentiary wanted one, and he got it.

Miller Samuel’s quarterly Manhattan housing market reports end up in the oddest hands – and in the usual ones, including those of brokers, reporters, and government types. Four times a year, the reports, which can have an impact well beyond the five boroughs, fall upon the nation’s most competitive housing market like so much snow, either lightly or heavily.

The third quarter 2005 report, for a blizzard-like example, perhaps single-handedly – and unintentionally – ended the housing boom, not only in the city, but nationwide. Miller Samuel’s report concluded that the average sales price of a Manhattan apartment had dropped nearly 13 percent, and the media from coast to coast ran away with that nugget, including the front page of the New York Times, declaring it definitive proof that the slowdown – or, depending on one’s view, bubble burst – had come. (Few noted the price-per-square-foot record notched that same third quarter, which wouldn’t have been as juicy a story.)

More often than not, though, the reports cause a mere flurry of wider public notice, however closely watched by the industry. The report for the last quarter of 2005, for instance, noted modest price gains and a drop-off in sales activity that probably will be negated by spring buys.

The meat of the reports comes from data collected by Miller Samuel appraisers and staff from the firm’s 4,000 to 5,000 residential appraisals annually in Manhattan. The data from the appraisals comes from various sources, with co-ops generally less likely to divulge information than more publicly accessible condo records. For co-ops, Miller Samuel might approach managing agents, board members, board attorneys – someone familiar with a particular co-op from the inside; for condos, the Real Estate Board of New York, the city, and Prudential Douglas Elliman, a brokerage that works with Miller Samuel on the quarterly reports, might be sources.

As the data comes in, it’s fed into the firm’s computer system.

“The most challenging aspect of the market report for me,” says Miller Samuel president and CEO Jonathan Miller, “is not the analysis and not putting the report in its final form – it’s the grunt work for getting the data clean. I don’t want any surprises.”

Once the data on closed residential transactions for the quarter is in and cleaned up, it’s dumped into a program known within the firm as “Super Market.” Within about an hour, Miller says, the software coughs up the data as a spreadsheet lined up with certain parameters, including neighborhoods and types of buildings. From there, the analysis by Miller personally starts, followed by a sort of fact-checking cross-examination, all to create what he insists is a historical basis to go on – not an authoritative pricing tool (though some brokers try to use it as one) nor a polished crystal ball into the market’s future.

Miller says the reports take about two days from the data dump into Super Market to the final version – a four-page release and an extended one, with aggregate data, posted on the firm’s Web site. There, they can be downloaded by anyone, though some people request copies by mail, like the prison chaplain. He wrote Miller from Texas a couple of years ago, after thinking he might use the information for a real estate class he taught the inmates.

The four-page release goes out by e-mail at the start of the following quarter – and the blizzard of interest usually follows shortly thereafter. “The hardest thing for me to do is to click the ‘send’ button,” Miller says. “It’s like being an airline pilot. You might’ve flown for years and years, but you still go down the checklist.”

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