# Manhattan real estate prices during the Great Depression

By [Brandon Donnelly](https://brandondonnelly.com) · 2017-11-26

black-tuesday, cities, great-depression, manhattan, manhattan-real-estate-prices, new-york-city, pricing, real-estate, real-estate-economics, real-estate-prices, roaring-twenties, stock-market-crash, uncategorized, urbanism, zoning

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I was searching around trying to find data on long-term real estate prices and I came across a paper by Tom Nicholas and Anna Scherbina called, [Real Estate Prices During the Roaring Twenties and the Great Depression](http://www.people.hbs.edu/tnicholas/anna_tom.pdf).

Here are some stats about Manhattan real estate (from the paper) that you all might find interesting:

\- In 1930, Manhattan housed 1.5% of the US population, but had approximately 4% of all US real estate wealth.

\- To construct their price indices the authors randomly collected 30 real estate transactions per month in Manhattan between 1920 and 1939. The mean price per square foot in 1929 was $6.91 (year of [Black Tuesday](https://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929)). And the mean price per square foot in 1939 – 10 years later – was $2.29.

\- Buildings containing a store at grade tended to sell at higher prices. The authors speculate that this could be because a zoning change in 1916 made it difficult to open stores in “residential” areas.

\- Buildings with three, four and five storeys tended to sell at a discount. Six storeys or higher and the buildings generally had an elevator, which resulted in higher pricing.

\- Manhattan real estate prices reached their highest level in Q3-1929 before falling 67% by 1932. Prices remained more or less flat during the Great Depression.

\- If you bought a “typical property” in 1920, it would have retained only 56% of its value (in nominal dollars) by 1939. In fact, it took until 1960 for assessed property values in Manhattan to exceed their pre-Depression pricing.

\- An investment in the stock market index during this same time period, 1920-1939, would have outperformed real estate by a factor of 5.2x.

Much of this probably seems hard to believe given the market today. Imagine waiting 40 years for the value of your property to come back.

_Photo by_ [_jesse orrico_](https://unsplash.com/photos/uEpPCwZKbDc?utm_source=unsplash&utm_medium=referral&utm_content=creditCopyText) _on_ [_Unsplash_](https://unsplash.com/?utm_source=unsplash&utm_medium=referral&utm_content=creditCopyText)

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*Originally published on [Brandon Donnelly](https://brandondonnelly.com/manhattan-real-estate-prices-during-the-great-depression)*