If housing prices were tracked like the stock market, urban cores would be soaring to new highs.
Joe Cortright describes the findings of a study by the investment ratings company Fitch as the most underreported news of the week, and possibly the year, for urbanists. "Here’s the simple number," writes Cortright, "since 2000, home prices in city centers have outperformed those in suburbs by 50 percent."
In our view, its the most under-reported story of last week, and if you are an urbanist, maybe the most under-reported story of the year. We blogged about it when the report came out, but it bears repeating: If you care about cities, and you’re looking for definitive evidence of the verdict of the market on urbanism—this is it. But we are also resigned to the fact that we are geeks, and stuff that gets our blood-racing leaves most people cold. So I’m groping for an analogy: the most convenient one is to the stock market.
Image a CNN business reporter saying:
“In the market today, city centers were up strongly to a new high”
Or a Wall Street Journal headline
“A bull market for city centers”
That’s the news here. Just as with private companies this price index is a great indicator of market performance. Imagine for a moment if you were CEO of Widgets, Inc, a publicly traded company. Every day, you’d be getting feedback from the market on how well you were doing, and on investor’s expectations for your company’s future. If your stock price went up, it would be a good indication that you were doing better, and that expectations were rising for future performance. Especially if you had a sustained rise in your stock price, and if your company were regularly outperforming both other companies in the widget industry, and the overall stock market. The reason the investment world is gaga over Warren Buffet is pretty much because he’s been able to do just that with the portfolio of companies he’s assembled under the Berkshire-Hathaway banner.
Wouldn’t it be great if we had the same kind of clear cut financial market style indicator on the health and prospects of our nation’s center cities?