Who are these people?
The New York Times today has an article about how rapidly increasing rents are driving people to think about buying instead. The basic story in New York City goes like this: With the housing market booming, in late 2002 everyone decided to buy, leading Manhattan's rental vacancy to a high of almost 4%. Plus, apartment building owners sold units off as condos. Then, when the housing market levelled off, people returned to a smaller rental market, dropping the vacancy rate to 0.43 percent in 2006. And, thus, crazy rent increases:
What is crazy about the article, though, is the people they profile and how much money they have. For example, "Dr. Carl Gerardi, a 39-year-old urologist in private practice in Manhattan and Westchester County," who decided to buy a place after his one bedroom apartment in TriBeCa was raised from $5000 to $6000/month. $5000 a month for a one bedroom! And his new place cost him $2.6 million, but of course he already had $1.3 million saved up for a down payment.
Or check this one out: "Leslie Marshall, a broker with the Corcoran Group, advises most clients that since rents for town houses or large apartments in Brooklyn Heights or Cobble Hill run about $9,000 a month, they are better off buying." 9000 a month = $108,000/year, just in rent.
Even the cheapie person they profile, a "freelance television producer" who decided to buy, will be paying $2500 month in mortgage and condo-fees, which works out to $30,000/year. For a 470 square foot studio!
As of 2002, according to the US Census, the median household (not individual, but household) income in NY City was about $39,000. Post-tax that's maybe $30-35k, of which you probably couldn't spend more than 50% on rent, which works out to about $1300/month. Which means you can rent a small broom closet somewhere in Manhattan.
Thank god to be moving to a city where housing is only insane and not yet ludicrous. Where is Henry George when you need him?
"In the last year, rents for market-rate apartments in Manhattan have jumped as much as 20 percent, or nearly three times the standard 5 to 7 percent increases seen each year in the last 15 years."So now people are thinking about buying again.
What is crazy about the article, though, is the people they profile and how much money they have. For example, "Dr. Carl Gerardi, a 39-year-old urologist in private practice in Manhattan and Westchester County," who decided to buy a place after his one bedroom apartment in TriBeCa was raised from $5000 to $6000/month. $5000 a month for a one bedroom! And his new place cost him $2.6 million, but of course he already had $1.3 million saved up for a down payment.
Or check this one out: "Leslie Marshall, a broker with the Corcoran Group, advises most clients that since rents for town houses or large apartments in Brooklyn Heights or Cobble Hill run about $9,000 a month, they are better off buying." 9000 a month = $108,000/year, just in rent.
Even the cheapie person they profile, a "freelance television producer" who decided to buy, will be paying $2500 month in mortgage and condo-fees, which works out to $30,000/year. For a 470 square foot studio!
As of 2002, according to the US Census, the median household (not individual, but household) income in NY City was about $39,000. Post-tax that's maybe $30-35k, of which you probably couldn't spend more than 50% on rent, which works out to about $1300/month. Which means you can rent a small broom closet somewhere in Manhattan.
Thank god to be moving to a city where housing is only insane and not yet ludicrous. Where is Henry George when you need him?
posted by bc at 9:42 AM
1 Comments:
I just don't understand where all that money comes from. Nobody I know will even buy me dinner at a Chinese restaurant.
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