As tension escalates about the fate of the city’s remaining share of $1.7 billion in Liberty Bonds for redevelopment downtown and Mayor Bloomberg and developer Larry Silverstein fire one salvo after another in the war of words over ground zero, let us take a step back. Ground zero is contentious for its symbolic and economic significance, and what is built there in the next decade will shape lower Manhattan for generations. But economic development in New York is not centered on that one 16-acre site. Mourning and politics take a long time, yet whatever happens at ground zero we are likely to see that one greatest testament to the spirit of New York in the face of the tragedy of 9/11 will be the extraordinary, city-wide real estate boom that has taken place in the years that immediately followed.

Nowhere are the positive trends more visible than in the housing market, itself an undercurrent in the ground zero debate in which the mayor’s vision for the site involves more housing units. Although the city’s housing crunch remains acute, the latest edition of the triennial Housing and Vacancy Survey, released Friday, shows a positive trend. Between 2002 and 2005, the city added an average of 17,000 new housing units a year, the largest increase since 1991. Homeownership also followed the upward trajectory these pages have noted before, rising to 33.3% in 2005 from 32.7% in 2002.

Housing is of better quality than ever before. A scant 0.5% of renter- or owner-occupied units in the city were identified as “dilapidated. “The dilapidation rate for rental units was 4% in 1965, and 1.3% as recently as 1996. Only 6.3% of rental units were reportedly near buildings with broken or boarded up windows in 2005, the best result since the survey started tracking neighborhood quality in 1978, and 71.3% of renter households rated the buildings in their area as good or excellent, again the best result in 27 years.

Also of particular relevance to the ground zero debate is where all this new housing stock is coming from. Converting office space into apartments is a growing trend, as the city’s Rent Guidelines Board noted in its own 2005 Housing Supply Report last summer, and especially in lower Manhattan. Conversions on Wall Street and Maiden Lane alone will add 728 rental units to the market by the end of this year.

None of these statistics serves to second-guess either the mayor’s or Mr.Silverstein’s contentions about what should be built at ground zero – they are doing a good enough job as it is second-guessing each other. The latest housing data do, however, invite a bit of humility in the face of the market. The mayor’s proposal embodies faith in the ability of an elected official to decide what the city needs to do on the site. Mr. Silverstein, as a private developer, offers something closer to a market approach but is still a lone tycoon crafting a plan that will reshape a city. Yet as the recent numbers show, smaller-scale developments are already reshaping the city just as dramatically as a major project at ground zero will. Ground zero matters, but there is also a vibrant city beyond the 16 acres.