Tuesday, December 2, 2008

Economic Hardships in NYC



http://www.observer.com/2008/real-estate/report-job-losses-drive-manhattan-apartment-vacancy-rate

The effects of a down economy are finally starting to really hit Manhattan. My favorite theory that I heard someone float: the Manhattan real-estate market was artificially propped up by a low-dollar while other markets had already started their plunge. The NY-region vs. the 20-city composite Case-Schiller suggests NYC's decline has been softer than other regions. On the way up, it seemed as if Manhattan kept up with the 20-city index. (Note: I didn't go so far as to do a regression analysis or look at the Case-Schiller indexes too deeply. If someone challenges me to look at the numbers, I will -- after finals! Please, post objections and arguments or references to papers as required.)

In other words, the dollar value was a dampener on the decline. Now that the dollar has rallied in the short term -and- the financial industry is falling apart completely, I think Manhattan will be smashed.

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