how can people afford to live in NYC?

Question

looking at the prices for houses in NYC i wonder how people can afford to live there. a normal one bedroom apartment in manhattan costs over $1million!!! heck, an average house in queens or brooklyn is around $750K too!!!!!
is everyone a doctor/lawyer/banker there?
i wonder how people with normal jobs can live there....how does a school teacher or police officer survive earning just $50K/year????
even the suburbs are extremely expensive.....surely not everyone commutes for 2 hours each way every day just so they can find affordable housing.

Answer 1

I actually live in NYC (Manhattan) and I grew up in the suburbs here. The real estate hasn't always been what it is now. The city is always expensive, but even 10 years ago the suburbs were sooo much cheaper it's ridiculous. I know people who have their houses in the burbs paid off completely and now they have to move out because they can't afford the property tax. They got their homes at 350K or so and now they are worth 800K. Many can afford it though because although prices are very expensive your income is higher.

It's also a very different lifestyle. Very few families live here (in Manhattan). There are a lot of singles and couples. Most of us rent. While rent is $2000/month or so telemarketing you can get $16/hr (which I do) and my husband gets 60K a year as a consultant with high annual raises and bonuses. We get 100K here and if we did the same job somewhere else we'd get 60K.

People have their priorities and if one of the top ones is living in Manhattan or NYC then they make it happen. Lots of people live in 3 bedroom apartments with 2 other people they don't know so they only pay $800/month. It sounds crazy but it's just life here. Sometimes 6 people live in a 3 bedroom. You sacfirice room for the lifestyle (which I don't think is a good trade off). I'm looking to move out because every year they raise rents higher and higher and I want a family.

I used to do real estate here in Manhattan and it's not really 1mil for a 1bedroom. Maybe if it's a really good size and in the hottest area... but you can find a 1 bedroom for around 500K that would do. I don't know how people move to NYC from anywhere else because the amount of living space you'll end up having is just a fraction of what you're probably used to... but for us NYers it's just what we are used to.

So yes, most if not all the people who own an apartment or something in NYC are rich. But lots of the people renting are struggling actors or such and they sacfirice space for location. I know people who commute 2 or 3 hours to work... which is ridiculous. If you know the right spots to look and the right people you can get something affordable in this town... but for most people.. you're better off moving somewhere else.

Answer 2

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Answer 3

Mind boggling, isn't it? What's even MORE mind boggling is that there's a tremendous housing shortage in Manhattan in all rent levels. Part is due to rent control laws. As any economist will tell you, price control ALWAYS creates shortages. That explains the rental shortage. But what explains the shortage of condos/co-ops for sale? At the lower level it is also due to rent control: because the same laws that limit rent increases limit the ability to convert units to condos. So the only way to get new units on the market is new construction (at new construction costs) or conversion of the highest end properties (which are out of rent control). All of which skews the market toward the highest prices.

What makes it all work is that NYC has converted from a manufacturing/trading center to a post-industrial communications & financial center. As such a lot of the wealthiest people in the world get to work there & they can afford the housing. Manhattan & the desirable close in parts of Brooklyn & Queens are turning into luxury lane. Everybody else will have to live in government or rent controlled housing or commute from where housing is still affordable.

Answer 4

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Answer 5

Well, where there is a will there is a way. My man and I make $80,000 after taxes combined, we pay $830 each for our apartment (1660 month) PLUS we have a car, but it is almost paid off. We sacrifice a lot to wake up in the city everyday. We don't spend money friviously. We don't buy big toys like plasma TV's, designer clothing, and we def do not eat out at expensive restaurants. Neither one of us drink or smoke, so there is a huge expense lifted right there! We cook at home, we shop at the local corner farmer carts, and buy in bulk at Walmart outside of the city. We entertain ourselves with all of the wonderful FREE things to do in the city, hang out in Central park, people watch, we go to the MET museum, and meet a lot of celebs. We also enjoy walking along the rivers and hanging out in the village, which of course is all free, and sometimes we will just hop on a subway or a bus around the city, or head out to Coney Island just for a few hours. For night life, we hit the clubs before they start charging a cover, which also saves us $$. We would rather wake up here, and pay this rent for the luxury and convenience of the city at our fingertips, than waste away our time, money, and weekends in a suburban mall shopping for things out of boredom since there really is nothing to do but go to a mall or a movie if you don't live in a big city!

PS And no, we aren't bankers, my man is a medical asst and I am a struggling, but making a living, playwright

Answer 6

Many people do commute 2 hours or more - which sucks the life right out of you. But, there's also a great many people who are what I call "house poor" - they have this fabulous place and maybe a nice car, but are mortgaged up to their eyeballs and have no savings or anything to fall back on.

That happened to someone I know - he was a stockbroker in the 90s or so, had a place in Trump Tower and everything and when the dot coms went belly up, he lost his shirt and ended up moving back home with mom and dad.

Answer 7

I know! ya know I never realized how expensive this city until recently because I never had to actually pay the rent or the morgage. Now Im planning to go apartment hunting with my best friend pretty soon and the rent prices are crazy high. But thats what you get if you wanna live in NYC, right? You cant beat this town =o)

Answer 8

oh they do commute the 2 hours. I know a couple that commute 3 hours one way. Two person income is how they do it.
You can take out 40 year mortgages now.
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Answer 9

It is crazy. Unfortunately, I know of alot of New Yorkers who are now choosing to move out of state. I do not see myself growing old here. I will eventually sell my family home (currently appraised for $800,000 & bought for like $50,000 in the early 70's) & move out of state, as well. I just can't see wasting $400,000 on a "Fixer-upper with $8-$10,000 in property taxes," when I could get so much more for that/or less money, out of state.

Answer 10

its virtually impossible for anyone just starting out to BUY anything now ...that is unless you have about $200000 to put down. Even then its a DINKS world.