I just re-signed my lease here in Brooklyn. While imperfect, my apartment is more than good enough to want to avoid the nightmare that is trying to find reasonably-priced housing in New York.
Though he never did manage to take many votes from the major party candidates, including eventual winner and current governor Andrew Cuomo, then-candidate Jimmy McMillan certainly struck a chord with me with his simple, but effective refrain — “The rent is too [d-word] high!”
With apologies to Mr. McMillan, new data from the Furman Center at NYU suggests that the problem is far more than just that the rent is too darn high. In fact, rent may be too low (by one measure).
Here’s that video:
Yes, rent truly is increasing in New York. From 2006 to 2011, median rent for recent movers across the five boroughs increased from $1,316 to $1,428 — a increase of 8.5% or 1.6% annually. A note for those who might say that $1,428 is high, but not crushingly so: Recall that the city is 468.5 square miles of land connected by bridges and tunnels. This measure includes places in Queens and Staten Island for which it would take hours to get downtown. At the extreme, to move into an apartment in the Financial District, Greenwich Village, or Soho, you would be looking at a median rent of $2,896, as of 2012.
Owning and wages
This graph shows the other two villains:
Of course, this being New York City, buying is a very difficult option for many. Before re-signing my lease, I personally looked for buildings in the Brooklyn neighborhoods near me, expecting there to be reasonable prices given the recent financial crisis and yet struggled to find anything of comparable size going for less than $900,000. As it happens, New York did bubble quite a bit, going from a median sales price for one-family buildings of $304,490 in 2000 up to a median price of $520,741 in 2006, before crashing. However, the crash was far from as bad as in other parts of the country and in New York, median prices never approached pre-peak prices reaching a low of $405,000 in 2012. And so that’s why it was still so hard for me to try to buy.
More important than that is that wages are going in the wrong direction. From 2000 to 2011, median household income actually fell from $54,646 to $50,433 in New York City; that’s a drop of 7.7%!
Oh right, I never did explain why rent might be too low. The real estate website Trulia found — and CNN reported — that among the ten biggest cities, only in the geographically tiny city of San Francsico (47 adorable square miles) does renting trump buying by a larger margin than across the five boroughs.
[Edit] Bonus link: A Buzzfeed non-slideshow that walks you through the very painful apartment hunting process here
Housing sucks in New York.
Source: “State of the City’s Housing & Neighborhoods.” Furman Center for Real Estate & Urban Policy at NYU, 2013. http://furmancenter.org/research/sonychan