Oh look, an article about the housing market that makes no sense at all. Quelle surprise.
An excellent example of some shabby reporting is this Wall Street Journal piece. He's talking about the the glut of rental apartments nationwide. The key word here is nationwide. Yeah, there are parts of the country that have been hit badly by the recession and areas where there isn't a huge rental market have a lot of inventory. No shock there. This strikes me as being a clear example of supply and demand.
It's clear this writer wants to make some connection to Manhattan, but instead of giving us actual numbers about the vacancy rates, he finds some lame quote from a recent renter. Nothing from a broker, a brokerage firm or even an analyst, and analysts are always more than happy to speak to the press. New York City, by the way, doesn't even show up on the list of cities with the most concessions to renters. And generally speaking, offering a free month of rent isn't much of a pain to a landlord. Very few landlords are operating on fumes. The concessions are offered just to make sure their units get rented so that their cash flow continues. Quite a few Manhattan landlords use their rentals properties as cash sources for larger development and investment projects.
The New York City rental market is still nice and tight, at least in the prime neighborhoods. You'll notice that his quote from the token renter doesn't mention where she rented. Was it the West Village? The Upper East Side? These are two completely different markets.
Back in September I spent over a week trying to find a $3000 one bedroom in Chelsea for a client, which is a pretty common price point in the neighborhood, and we had maybe six to choose from. Where was the glut of inventory that the press likes to make so much noise about?
The majority of the WSJ piece just rehashes a bunch of housing info that even the most leisurely follower of the news would already know, but it doesn't tell the New York reader much about their city. Which one would expect, considering it is The Wall Street Journal.
One thing to keep in mind when reading any kind of journalism, especially financial journalism -- and this is coming from someone who worked in the biz for eight years -- is that very few journalists have ever actually worked in the field that they cover. Veteran or even plucky writers obviously become quite good at what they do, but in this economy, where reporters are getting laid off in high numbers through no fault of their own, their next gig may likely have nothing to do with what they were doing before.
One large area of growth for journalists is financial journalism. Financial web sites are becoming a cottage industry, and their quality varies. A novice business reporter starts out by churning out pieces about earnings reports and economic indicators, (such as the piece in question) and eventually expands to larger think pieces. But if you put a gun to their heads and asked them to explain a credit default swap or a few basic mathematical models, they couldn't do that. Is that problematic? Perhaps.
Which isn't to say that I, personally, am suspicious of all business news. Back when I was hanging around Old Greenwich, I took a 7:29 train into Manhattan in the morning with quite a few people in decision making positions. They all read the FT, which got me into reading the FT, which is why I still have a subscription.
