I continue to be interested in the question of the price of land (as opposed to the price of structures) and this New York Fed research on “The Price of Land in the New York Metropolitan Area” (PDF) is very interesting. It shows that land prices can be closely tied to distance from the Empire State Building:
It’s a reminder that, among other things, people living in expensive houses in Manhattan and the convenient parts of Brooklyn and Queens aren’t just experiencing “high housing costs” or a “high cost of living;” they’re specifically purchasing a commodity — space with easy access to the core business districts of America’s largest city — that the market puts a very high price on. About a month ago, I saw some folks mocking Ed Glaeser for thinking that Manhattan isn’t dense enough. And obviously there’s a sense in which that contention is laughable — it’s really dense! But the point is that the density in New York City, though high, is actually low relative to the market price of the land the structures are on.