Tag: real estate values

• Listed.fun (and something else)

  This is a fun little passion project by Airbnb-engineer Andrew Pariser and someone known as Potch. The way it works is that it shows you a picture of a recently sold property, and you have to guess what it sold for. You get a bunch of guesses, and after each one, you are given more information about the property and some feedback on how close you are. To win, you need to get within 1%.

  When I tried it out, my initial guess was way off (too high). Toronto has trained me well. I also wasn’t sure where Evansville, Indiana was, so that bit of information didn’t really help me. But the arrows telling me I was way too high, certainly did. The reality is that it’s pretty hard to guess the value of a home if you don’t know where it is, you can’t see interior photos, and you generally don’t have enough information.

  But what if you were from Evansville, Indiana and what if you did have enough information? I bet that the guestimates would actually be pretty accurate. This idea of crowd-sourcing market information and pulling wisdom from crowds has long interested me, because price discovery is a major pain point for real estate. Sure you can look at comparable sales and current listings, but that is not an exact science. Neither are algorithms.

  But what if there was a way to test the market and get pricing feedback before you actually list? Would you trust it more than Zillow’s algorithm? This is something that I’m working on testing right now through a passion project called Unlyst. Myself and a few others are working on a very simple product that will be released this fall. If you’d like to follow along, sign up here.

  2022.09.09

• What’s Manhattan worth?

  I like looking at real estate values over longer periods of time because it helps to put things into perspective. 

  Below is a land value index for Manhattan running from 1950 to 2014 that was recently created by economists out of Rutgers University.

  

  The study was also cited in this recent article by Richard Florida.

  Here are some of the highlights from their study:

  We find three major cycles with land values reaching their nadir in 1977, just after the city’s fiscal crisis.

  Since 1993, land prices have risen much faster than population or employment, at an average annual rate of 15.8%.

  We estimate the entire amount of developable land on Manhattan in 2014 was worth approximately $1.74 trillion.

  We estimate the long run return to Manhattan land values [since the island was first inhabited by Dutch settlers in 1626] to be about 6.4%.

  What’s fascinating to me is the accelerated appreciation. The index starts at 100 in 1950, ends up slightly above that by 1993, and then simply takes off.

  2018.05.01