New York Has Less Affordable Neighborhoods Than Other Major US Cities
Long Island City, LES, and Williamsburg Top NYC List of Unaffordable Neighborhoods
Despite what you’ve heard, finding an apartment in NYC is actually pretty easy; affording one is the hard part. With median asking rents that vary from expensive ($1,750 for a 2-bedroom in West Concourse) to downright insane ($5,232.50 in Lincoln Square) it’s no wonder New Yorkers are so pleasant. To get a better understanding of the NYC affordable housing crisis, RentHop took a look at the data on two-bedroom apartments and compared it to the most recent median income data available at the neighborhood level. (Interactive map and full list below)
Of the 139 neighborhoods that we had data for, just 9 of them had median asking rents that could be afforded with 35% of the neighborhood’s median income. That’s just 6.5% of neighborhoods – the lowest percent among the 5 major cities we looked at. Recommended affordability is 30% but we added an additional 5% to make room for income growth that has taken place since the Census data was released.
- Miami was the next least affordable with just 9.3% of neighborhoods being “affordable”
- Los Angeles had 30.8% of neighborhoods within reach
- Chicago was a little better with 42% of neighborhoods being affordable
- Boston had the highest percent of affordable neighborhoods at 60.7%
The Map Below Compares NYC Two-Bedroom Median Rents to Neighborhood Incomes
The map above shows the median asking rent of two-bedroom apartments in neighborhood tabulation areas (NTAs) across New York City and how that relates to the income of those neighborhoods. Darker shades of red indicate lower affordability, while the few green areas indicate that median asking rents are within reach for the neighborhood’s median household income.
It’s important to keep in mind that these are median asking rents and not necessarily what people living there are actually paying. Neighborhood median rent means that half of apartments rent for less than this amount and half are above. RentHop didn’t have sufficient data in the neighborhoods that are grayed out.
The 40x Rule – 30% of Income
You may have heard you shouldn’t spend more than 30% of your income on rent. The way the math works out, your household’s yearly income should be 40 times the monthly rent to afford an apartment and many landlords won’t accept anyone who doesn’t.
For example: for NYC as a whole, the median two-bedroom rent was $3,500 (for the quarter ending June 30, 2017) which would require household income of $140,000 to secure and comfortably afford. The median income for the city stands at $55,752 according to the most recent census data, putting the median two-bedroom far out of reach, since spending 75.3% of your income on rent isn’t a good idea.
There are exceptions to the rule: If you have vast savings or a guarantor whom makes 80 times the rent, a landlord is likely to let you slide without meeting the income requirements. It’s also not unheard of for a landlord to request last month’s rent in addition to the first month and security deposit for those with below average credit / income. Our “how much can I afford” guide can give you a little more info on these rules and some ways to overcome them.
These Neighborhoods Are NYC’s Least Affordable
The neighborhood tabulation area of Queensbridge-Ravenswood-Long Island City topped the list of unaffordable neighborhoods. Median rent for a two-bedroom is $3,300 while median household income is just $28,378. Rent prices soar higher as the real estate boom continues to change the face of the area while putting new apartments far out of reach of the current households. Spending 139.5% of your income on rent is not just absurd, it’s mathematically impossible.
In a close second was Williamsburg (not the hipster haven that’s colloquially called Williamsburg which the city still calls ‘North Side-South Side’) but the area a bit south of there known for being home to much of the city’s Hasidic population. Here, the $2,499 two-bedroom median rent would require 139.5% of the $21,502 median household income to be spent on rent.
The neighborhood with the third largest income-housing cost gap was Lower East Side, where the median household would need to spend 134% of the $31,273 neighborhood income for two-bedroom asking rent of $3,495. LES is known for its night life and rough-and-tumble past, but the wealth gap and expensive apartments are the true story here.
Mott Haven-Port Morris in the Bronx (130% of area income needed for the $2,200 2br-rent), and East Harlem North (115%) round out the top 5 least affordable, while many areas of the Bronx make the top 10. The high poverty rate in the Bronx (27.9% of households in poverty) is certainly correlated.
The Table Below Displays All Two-Bedroom Median Asking Rents
It also shows the percent of income spent and income required in all neighborhoods for which we had sufficient data. You can sort by price, alphabetically, or (un)affordability by clicking the top of the column.
Is There Anywhere in New York That’s Actually Affordable?
Click a column head to re-sort the table in ascending order. This will show the most affordable places in New York.
Upper East Side-Carnegie Hill topped our list of affordable neighborhoods, bolstered by having the highest median income in the city. Just 27.5% of the neighborhood’s $155,213 income would be needed to rent a median two-bedroom for $3,555.
Great Kills of Staten Island was a close second, being one of just a handful where the median income ($88,868) could comfortably afford the median rent ($2,050). Just 27.7% of the median income would be spend on rent here. Whitestone, Queens at 29.1% income for rent rounds out the top 3. New Dorp Staten Island and a handful of neighborhoods in Queens make the short list of neighborhoods where rent is affordable to those making median income.
What Does This Mean For You?
While these stats aren’t the only factor that determines what one can and cannot afford; they serve to highlight the widespread affordable housing crisis afflicting many US cities. NYC is known for being the center of much of the country’s wealth, with some truly awesome apartments designed for those residents.
Looking at our hundreds of thousands of apartment listings we certainly notice a trend: most apartments are being built and advertised to the higher end of the market, leaving a majority of people left wondering how and where they’ll live. We encourage you to entertain all options when finding a new apartment, including having as many income-earners in the household as possible and looking at apartments with more bedrooms to bring down the average cost per bedroom.