Report on 30 Years of Real Estate Turbulence Can't Predict Future

NYU's Furman Center for Real Estate and Urban Policy has released a massive report examining how the city's 59 community districts have fared during four distinct real estate periods: two upturns (from 1980 - 1989 and from 1996 - 2006) and two downturns (from 1974 - 1980 and from 1989 - 1996). Between '74 and '80, housing prices declined by 12.4% citywide; between '80 and '89 prices increased by 152%; then between '89 and '96, prices dropped by 29.3%; and in the last boom, which lasted from '96 to '06, prices grew by 124.2%. All in all, sales prices citywide grew by 250 percent during the 32 year time span!

Analysts studied a wide range of housing, demographics, and quality of life
indicators to try and predict how the current downturn will effect NYC communities. But researchers found that a neighborhood’s performance during the 1974-1980 housing bust had little relationship to how that neighborhood fared in the next downturn. Ingrid Gould Ellen, co-director of the Furman Center, admits to Crain's, "We didn’t find the answer to the $100,000 question that everyone wants to know—what’s going to happen in my neighborhood?" But the report does include some interesting stats:

• During the 1989-1996 downturn, some of the poorest neighborhoods in the Bronx and Brooklyn fared relatively well, because city investment in renovation and rehabilitation helped stabilize home prices.
• During the last boom, property values increased most in East Harlem (sextupled between 1996 and 2006), Morningside Heights (quintupled) and Washington Heights (quadrupled).
• Bedford-Stuyvesant residents produce the most waste: 3.1 pounds a day per resident after recycling. By comparison, Park Slopers produce an average 2 pounds a day each.
• Residents of East New York experience the city's longest travel times when using public transportation; a trip to midtown took an average 63 minutes in 2007, the latest year for which data was available.
• Bushwick had the most serious housing-code violations of any single neighborhood, 193.2 per 1,000 residences. Midtown had the least, with 13.2 violations per 1,000 reported.

Ellen says the report proves the importance of city investment in at-risk communities during a downturn, "particularly as we see neighborhoods blanketed by foreclosures that are vulnerable to vacancies and decline. Strategic investments in attacking the blight spots can really help to protect neighborhoods."

And Vicki Been, co-director of the Furman Center, tells the Post that because the current financial crisis is so expansive, it's difficult to draw on the report for future guidance: "This is the first time in a very long time that we've had a nationwide free fall of housing prices that basically left no market untouched. Housing stats across the nation are already way below the bottom of the last two downturns. That's frightening."