Reporters are suckers for statistics. They help ground our stories and present more evidence than mere anecdotal reports. They also make us sound official. You can see the importance of good data in many of the cover stories in this issue, of course. We researched which brokerages are marketing the most new residential development units, in order to judge who’s leading the pack following the downturn; we looked at the dollar value of hotel purchases to show how that sector has grown red hot for investors again; and so on.
That said, some stats are easier to get than others.
Taking a page from “Freakonomics” — the book by “rogue” economists Steven Levitt and Stephen Dubner on subjects usually not covered by traditional economists — as well as from author Malcolm Gladwell, I’ve put together a list of stats that haven’t been compiled by anyone, but that would really capture what’s going on in the market. Hey, in a tenuous market like this, anything that can explain what’s happening helps.
• Everyone has summer on the brain come August. Our story on whether it makes sense to list properties during the summer, while so many people are away, raises a bunch of questions. How much net worth disappears from New York City every summer when the rich head to the Hamptons and other vacation spots, anyway? And by extension, how much does the spending power of the city decline during the dog days of summer? By half? Twenty-five percent? If so, maybe it’s better to wait until fall to list after all.
• On the flip side of the economic spectrum, it would have been nice to have uncovered a stat showing the impact the “Jersey Shore” reality TV show has had on the Seaside Heights real estate market, where it was filmed. Did the area see prices buffered (or did they decline faster) compared to other towns? Does low-class make for lower prices?
• Then there is this summer’s record heat. When the thermostat hit 104 degrees in Manhattan last month (the highest temperature recorded since 1977 and just two degrees shy of the record), what happened to residential activity in terms of open houses and sales? What is the historical correlation between heat waves and home sales? Sounds like a project for über-appraiser Jonathan Miller.
• Next, our piece on the remaking of the East River waterfront tells part of the story of how New York has gentrified over the past two decades. From ferry service to bike paths to miles of walkways planned or underway, it’s amazing how the once-neglected waterfront is being reborn. What really would have shown the transition? A chart showing the number of dead bodies floating in the East River (and the endless number of TV talk show jokes about those bodies as a sign of New York’s decay) in the 1990s, versus the square feet of esplanades constructed in the 2000s. Morbid, I know. But statistically significant. The former has dropped off as the latter has increased, and continues to rise.
• Though the market has improved here in New York relative to the rest of the country, it’s hard to make heads or tails of what’s next. One leading indicator might come from the big real estate gatherings around town, and the decibel levels of the crowds. The higher that spirits are running, the more likely it is that deals are being discussed. The less the speakers or performers can be heard, and the more elevated the volume, it stands to reason, the better the market. Someone should track that ratio. (Case in point: 2004’s opening of the Time Warner Center, when comedian Jon Stewart and the musician Jewel were effectively shut down by real estate machers refusing to be quiet. That was a high-water mark when the easy-credit boom was beginning.)
Of course, there are plenty of non-numbers-focused stories in the issue, too, that are worth a close read. Starting on page 36, we explain the myriad ways that properties can go from distressed to “healthy” as the market stabilizes — everything from hostile takeovers to negotiated loans. We also take a look at the rise in “cyber-warfare” in the industry — where brokerages are sneakily buying up the domain names of rival firms in order to get more website traffic.
Enjoy the issue and enjoy the rest of summer.
Stuart Elliott