Is New York City affordable?
This week we analyzed various databases and took to the streets to ask New Yorkers the question on everyone's mind.
Welcome to RentWire!
We’re RentWire, a pop-up newsletter dedicated to all things rent in New York City. As we cover commercial and residential rent news in New York, we can’t help but address the elephant in the rent-stabilized room: is New York City affordable? We’d love a penny for your thoughts, the only rent we’d ever charge, so join the conversation on Twitter and read below.
Five Things to Know: Rent This Week
It’s the first of the month, and for most of us, that means rent is due! Here’s some news to get you through the week:
The controversial Rent Guidelines Board approval this past June on increased rent rate goes into effect today. Landlords of rent-stabilized apartments can now increase rent by 1.5% after six months. That means that if you sign a lease today in a rent-stabilized building your landlord can increase it by 1.5% on April 1 – a pretty bad April fools joke if you ask us.
The number of rentals available in New York City is now lower than the pre-pandemic levels according to StreetEasy data. While in March 2020, there were over 16,000 rentals, there are currently 12,742 rentals in the five boroughs – compared to 48,753 in September 2020.
New York’s rent relief fund is projected to run dry in the next week, and hundreds of thousands of residents who quality haven’t applied for aid yet. If you are worried about making your rent due to COVID, find more information here.
If your pandemic apartment deal is ending and your landlord hiked up prices, you’re not alone. The market may be erratic but your landlord is required to give you 30 days notice on any increases above five percent if you’ve lived there one year, 60 for two years, and 90 for more. Hold your landlord accountable with more information here.
The Condo-board of skyscraper Park Avenue 432 sued the developer for $125 million in damages. Read more about the damages to the mega-skyscrapers multi-million dollar apartments.
Leaving NYC, for different reasons
Housing data and trends are closely tied to population flows in New York City, which saw the population fall by 126,355 people between July 2019 and July 2020, to 19.3 million. The 0.65% drop topped any state by total and percentage, according to the latest data from the U.S. Census Bureau.
At the height of the pandemic, a net 70,000 people left New York City in 2020, resulting in roughly $34 billion in lost income, according to an estimate from Unacast, a location analytic company.
Exodus from New York City during the pandemic because of rent increases and lifestyle restrictions changed the make-up of the city.
Isabel Leon, 40, said that many middle-class residents who used to live in Chelsea moved to cheaper cities in Florida, Texas and Arizona after the pandemic.
"Some apartments became empty after the pandemic, because they (the owners) moved to cheaper places. They work remotely for companies located in New York," said Leon, who worked as a babysitter for years.
"Some of them even find new jobs in Florida or Texas, and never come back to New York," she added. Many of her colleagues were fired by the families who employed them in Chelsea because they moved to other cities.
Although the vacancy rate of Manhattan hit a 16-month low in August 2021, which indicated stronger economic activity, Chelsea maintained a relatively high vacancy rate throughout the pandemic. In June 2020, Manhattan vacancies reached 2.58%, the highest on record since 2007, according to lifestyle blog Inhabit by Corcoran. The vacancy rate in Chelsea reached 3.41% that month, ranking the second highest among all neighborhoods in Manhattan only after East Village's 5.03%.
As working remotely becomes a new, post-pandemic normal, a September 2020 survey by the Manhattan Institute found that 44% of high-income New Yorkers who earn over $100,000 a year considered relocating outside the city in the past four months, with cost of living cited as the biggest reason.
Kristina Uriegas-Reyes, a vintage shop owner in her hometown of San Antonio, left New York City after living here for seven years. She paid $1,010 a month for a 400-square-foot studio in Brooklyn before she moved to her current 4-bedroom apartment, for which she pays the same price.
The loss of "passion for writing and blogging part-time," Uriegas-Reyes said, was her primary reason for moving. Though she didn't mind her rent, opening a shop in New York would’ve been too hard.
"I always describe my life in NYC as attending fashion week across from Anna Wintour and working at Trader Joe's to have health insurance," said Uriegas-Reyes.
Who’s Buyin’?
In a pre-pandemic world, New York City's real estate market was dominated by the middle class and family-oriented buyers. The intensity of the market and competitive inventory led buyers to keep a more open mind about location and found more affordable (yet desirable) homes in NYC boroughs like Queens and Staten Island.
The Census Bureau reported that the homeownership rate in 2019 was 64.1%. Homeownership in Staten Island (65.7%) surpassed the National Average (64.1%) in 2019.
According to the National Association of Realtors, most homebuyers in the NY-NJ-PA metro area are in their 40s, with a median income of $121,786.
66.2% of homebuyers are white, while 10.2% are Black, 15.2% are Asian, and 15.8% are Hispanic.
Most homebuyers (60.9%) come from a traditional household where the couples are married with children. Single mothers who are homebuyers make up 8.8%, while single fathers make up 2.9%.
37.1% of homeowners have a graduate professional degree. In 2019, 52.5% of home buyers purchased a house, while 31.3% purchased an apartment.
Surviving New York City’s Rent Increase
Picture this: You move to New York. There are cheap hot dog stands on every corner, and you eat one on a cool, fall day on the steps of the Met, which is free. It is, as promised, the greatest city in the world. But according to a report by StreetEasy, 65.2% of the average New Yorker's income will go toward rent, a significant jump from last year's 59.7%, minimizing the so-called “amenities” that a typical resident may seek out. It begs the million-dollar question: What do you need to simply “survive” in New York City?
Here are a few tips to start:
1. Apply for Rent Relief: NY distributed $400M in federal funding, opened eligibility to more tenants.
Emergency rent relief in New York will soon be available to higher-income tenants as its rollout hit its stride recently, Governor Kathy Hochul announced earlier this week. Almost $400 million has already been distributed to landlords on behalf of tenants, and $1.2 billion total — close to half of the federal and state money allotted — has been made available to eligible recipients. New Yorkers who make between 80% and 120% of the area median income are eligible to apply for the program.
2. Commute! Hot take: Transportation in New York City is good. Cars are not.
3. Laundromats
Apartments with washers and dryers make up only about 27% of rental listings in the city, according to StreetEasy, the site where you’re most likely to find your new digs.
Of apartments under $1,600 (the recommended median), only three percent have in-unit washer and dryers and 27% in-building laundry. This limits your apartment rental search significantly. According to a New York Times report, appraisal company Miller Samuel estimated that in-unit laundry can add as much as five percent to the overall price of an apartment. Luckily, the Wall Street Journal reported that there are over 2,000 licensed laundromats throughout the city. Start pocketing those quarters! You might even find a hot dog stand along the way.
Why Are They Moving?
Cheaper rent in old haunts
Roy Campos has worked with some of the top designers in the fashion industry: Elie Tahari, Derek Lamb, Canvas & Hyde, JLew Bags, Kenneth Cole, and has produced his own line of handbags as well. Since 1989, he has been making all of his designs from his workshop in the Brooklyn Navy Yard. I spoke with him about why he chose to move his business from Manhattan to Brooklyn. Despite the fact that he moved three decades ago, his story is a timeless example of resilience in the business world. Our conversation has been edited for length.
You started your business in the 1980’s making leather jackets in the Garment District. Why did you move your workshop from Manhattan to Brooklyn?
RC: At the time, I was doing flea markets and I had a shop there… 262 West 38th Street.
I drive to the garment center, park the car, go up – I was on the fourth floor – and then right away I see a big hole in the wall [where thieves] broke in. They cleaned me out!
So what do I do? So I have my little office and I go there. In front of me is this magazine, Crane Magazine. And then I was reading, thinking, and I got into this page, “Renting in the Brooklyn Navy Yard.” ‘Okay, this sounds interesting.’ I came, I looked at it, it was like three times bigger than the one in the Garment District. Inside of me, I think, ‘This is my home!’
What was the difference in rent between the two locations?
At that time they already were hitting two-thousand-and-something [...] and when I came here, you will see one thousand and change.
Were there any difficulties moving your business to Brooklyn?
Back in the days Dumbo was trashy, let me tell you! It was done the way it is right now. Back in the day, people didn't want to come here. Not even my employees when I told them I was moving here. 'No, Roy, we're not going with you! They kill over there!' Which was true! York station [...], if you were not from the neighborhood... *draws finger across throat*
Then I say [to my mentor], ‘Arno, I'm moving there because of this and that, but the employees don't want to go. They think I’m losing it.’ And he said, ‘Roy in this business, you got to be made out of steel! Go!’ So I just did it. And then you know what? They all followed me!
Interested in hearing more of Roy’s story? Read the full profile on our website later this month!
What’s to come
In a couple of weeks, RentWire reporters will be going around New York, asking people how they manage to make it here, when they could make it anywhere else.
Do you have any tips, comments, or questions? Email us at rentwirenyc@gmail.com and follow us on Twitter @RentWireNYC
Some real estate history
Dunbar Apartments was one of the first co-op buildings to directly house the African American population in Harlem. In 2021, a two bedroom apartment at Dunbar would rent for $2400 a month.
Photos courtesy of The New York Public Library Digital Collections, 1929 and Wikimedia. Copyright 2000,2001,2002 Free Software Foundation, Inc