Following the 30% of your salary rule, that means you need to earn, at minimum, $116,400 USD per year to afford 360sq ft.

The Manhattan standard for landlords is 40x annual rent, or $119k.

If you base the rule on net income instead of gross income, you'd need 200k per year to afford it properly.

Assumption: 40% is the federal + NY state + NY city income tax for a six-figure earner

200K * 0.60 = 120k of net income = 10k/month net income

3k rent / 10k monthly net income = 30% of net income

For what it's worth I've always heard it as 30% of your gross pay, not net.

I don't know why. It just adds a level of indirection. Comparing anything with gross pay is pretty meaningless.

Quite the opposite. Comparing anything with net pay is pretty pointless. Your total tax rate depends on many factors: total household income, number of kids, deductibles, filling jointly or separately, etc. Plus, the exact amount varies over the year, depending on how much you've already contributed in sales and federal taxes. On the other hand, gross pay is a single, round, fixed number.

I understand this may sound a weird concept for people in some countries outside the US, but it's a much simpler concept once you get used to it.

To continue off of what guiambros said, unless you get no refund or bill come tax time every April, you don't know what your net pay is until Q2 of the following year.

$2975 for a 360sq ft apartment furnished with niche transformable furniture, and access to communal lounges, roof deck and grill. Unfurnished is cheaper :)

That price is insane. I pay less for a bigger apartment with brand new appliances, dishwasher, roof deck, doorman etc and I live in a much better location in Manhattan. I even pay less than the unfurnished price.

When did you move in? Would it be correct to say that if you moved out tomorrow, that someone would move in at a way higher price than what you're currently paying? Cause that's often the case.

That having been said, the price is indeed insane.

Sept. Doubt it.

What can we actually do about it?

It depends on what you mean be 'we' and 'can', but Manhattan could have significantly higher population density without overwhelming the infrastructure. In fact, IIRC it isn't even currently at its maximum population density.

One barrier among many to that is the overreach of the preservation movement. Of course I think it was a tragedy what happened to the original Penn Station but the pendulum has swung way way too far. Buildings, blocks, and even entire neighborhoods that don't have much compelling about them at all have had preservation related restrictions put in place. To take a specific example, much of the East Village is downright ugly and is historically significant only for being an affordable place for newcomers to live. The best way to honor that legacy isn't preserving blocks and blocks of four to six story walkups but by allowing a lot more density to bring prices down -- particularly towards the south-west part of the neighborhood where there are more subway options.

This doesn't really apply to Manhattan, but elsewhere in New York and most other cities there are a lot of 2-3 story buildings still, many of which are single-family homes. Some of those are worth keeping, but in many cases they could be replaced with 4-6 story mixed-use buildings with little objection. That's an instant doubling in density without having to resort to high-rises. Paris, for example, maintains a higher population density than New York or San Fransisco with a lower average building height. European cities also see huge gains in density because they dedicate less space to roads and parking, a practice American city planners are catching on to. There is so much we could be doing to avoid housing shortages if we actually tried. Too bad everyone is so fixated on the value of their property going up.

I'm starting to notice there is a general pattern of anti-development NIMBY almost everywhere. It's either an instinct, not liking change in general, not liking newcomers, irritation at construction or national incentives that cause it. It's probably a combination of all of them.

And I suspect most of this isn't anything new. What is at least somewhat different is that, in general, a Robert Moses [1] can't come into a city and remake it to his vision while largely ignoring those who think differently. This change is not entirely a bad thing. On the other hand, it often makes things like large-scale transportation projects much more difficult to accomplish than in the past.

[1] https://en.wikipedia.org/wiki/Robert_Moses

There's degrees of NIMBY-ism. "Don't bulldoze my house bro!" might be seen as NIMBY-ism, but IMO is a lot easier to sympathize with than total & complete anti-development.

Development in my area is poorly constructed, ugly, still expensive, and created by people who have no interest in the neighborhood. They make it hard to love.

> but Manhattan could have significantly higher population density without overwhelming the infrastructure.

This is not really true, mostly based on the transportation infrastructure. Manhattan is absolutely not ready to move more people around per day. Both train and car traffic is rising sharply and neither system are scaling particularly gracefully. I'm not informed about water treatment, police/fire services etc., but I'd be surprised to hear that they are operating with a lot of room for growth. Hospitals are a mess.

Have you ever played any Sim City at all? Jeez this is basic stuff :)

Street congestion is increasingly a problem, not so much because it slows down private cars but because it slows down buses. Those bus delays in turn increase subway ridership, and overcrowding slows trains loading and unloading.

Although uber does probably deserve some of the blame the mayor's attempted response was ham-fisted and bound the fail. The answer is a congestion fee like Bloomberg wanted to put in. Also eliminating most city employee parking permits and upping the cost of on-street parking to prevent circling.

As for the subway, it depends on the line. The Lexington Avenue line is the most overcrowded. More trains can't be added at this point -- at least not without CBTC (which they should really prioritize more!) The second avenue subway should help there, but that's not exactly around the corner either. After the Lexington Line the next most congested is the L, which is only relevant to a small part of Manhattan (but has big implications for growth in northern Brooklyn) and the E/F coming in from Queens until it hits midtown. That leaves the majority of Manhattan with spare subway capacity to move people around.

Specifically with respect to the East Village, it is because of crowding on the Lexington line that I suggested densification should start at the south-west part of the neighborhood which has access to the sixth avenue line subways.

> Street congestion is increasingly a problem, not so much because it slows down private cars but because it slows down buses. Those bus delays in turn increase subway ridership, and overcrowding slows trains loading and unloading.

I think the issue is population growth not matching funding (or Albany robbing us). I don't doubt that this contributes, but I'd be surprised to see people switching from buses to subway being a leading cause of subway congestion.

> Although uber does probably deserve some of the blame t

Again this seems like a really small thing. I doubt uber created many new taxis, so much as absorbed yellow/livery cabs. I'm sure it has an effect but I don't think it's the core issue.

> The answer is a congestion fee like Bloomberg wanted to put in.

100% agreed with the congestion fee, bummed it didn't happen.

> That leaves the majority of Manhattan with spare subway capacity to move people around.

I don't think this is true. One of the reasons the green line is so overcrowded is because so many people work on that line. It's not only about where people live. If you put people next to the E, it doesn't mean they only take the E.

> it is because of crowding on the Lexington line that I suggested densification should start at the south-west part of the neighborhood which has access to the sixth avenue line subways.

I agree that we should rezone and that the preservation stuff is a nightmare.

>> That leaves the majority of Manhattan with spare subway capacity to move people around.

> I don't think this is true. One of the reasons the green line is so overcrowded is because so many people work on that line. It's not only about where people live. If you put people next to the E, it doesn't mean they only take the E.

First, I'm not sure that's the case. Most of the jobs in Manhattan are in midtown and downtown. Downtown all the lines converge and in midtown there's multiple crosstown subways. Sure if you work at Hunter College you have to take the Lexington line, but that's a relatively small number of people.

Second, inasmuch as its about where you work rather than where you live it doesn't matter whether or not you put new housing in Manhattan. If you put it in Jersey City or Brooklyn you still need to get those people to work. A moritorium on new housing in the entire metro area is a non-starter. So from that POV, you might as well put them in Manhattan.

--

Certainly though I agree that Albany and Washington should quit ripping us off so hard and that the MTA should be less dysfunctional. We could use more and better running mass transportation.

Yeah I was implying that the green line is the way most people get from BK, BX and upper manhattan into Midtown, where most of the jobs are. But yeah I pretty much agree with everything else you wrote. It's a tough situation.

There are geological reasons why the east village isn't built as high as other parts of Manhattan.

I don't know about the East Village specifically but, apparently, the notion that Manhattan skyscrapers are only built where the bedrock is close to the surface is false.

http://observer.com/2012/01/uncanny-valley-the-real-reason-t...

(And, by way of another data point, the tall buildings in Boston's Back Bay are built on landfill.)

Those are historical reasons. With modern construction techniques skyscrapers can be built virtually anywhere. In any event even eleven to fourteen story buildings which the geology could certainly support (Stuyvesant Town and the Riis Houses are those heights), would be a big improvement over six story walkups.

Yes, the Penn Station story is certainly sad. At the same time, I think it's hard to say that the "urban renewal" leading to Lincoln Center wasn't a net positive.

We could go example / counter example all day long. The highways cut through living neighborhoods destroyed the southern Bronx and it's never recovered. Development can be done well or it can be done poorly, but to decide which is which we need to first agree and what we are trying to achieve. Personally, I don't think much of "character of the community" arguments. If you want that move out of one of the quaint bedroom communities in Westchester, Nassau or Jersey.

@misiti3780 The original Penn Station was a beautiful, light filled, Beaux-Arts style building. It was knocked down to put up Madison Square Garden (a sports arena) and an office building. The current Penn Station is a depressing, underground, dirty warren. The NYC preservation movement has its beginning in the uproar over tearing the old one.

I'm pretty anti-NIMBY, but the Penn Station example is my line. So long as you're not doing something of that magnitude, you should be free to build whatever you want.

what is the "penn state story"?

Where Pennsylvania Station in NYC (and Madison Square Garden) sits today was once a grand station building designed by McKim, Mead, and White. When Penn Central went bankrupt, the air rights were sold off and the railroad station was moved completely underground. The demolition of the old Penn Station was widely regarded as essentially cultural vandalism and arguably played a role in a shift of attitudes toward a more preservationist mindset. (Others argue that this storyline is an oversimplification and there was growing pushback about 60s era urban renewal in any case.)

https://en.wikipedia.org/wiki/Pennsylvania_Station_(New_York...

As most Robert Moses stories go, it's about car culture and using highways and other physical barriers to enforce some bad socioeconomic policies - which was very common around the world at the time. In the end, they ripped down the old iconic station to build arguably the ugliest sports stadium in the world (Madison Sq Garden) and equally unimpressive #1 Penn Plaza.

Note that the tracks and platforms haven't changed much since 1905 with the exception of the demolition of the "Northern" yard and highline when they build the Javitz center.

The new WSY will be build atop the existing platforms... so 3 iterations of station on top of unchanged train platform in a bit over a century.

Penn station used to be as magnificent as grand central, but was torn down and replaced by a mire of grimy tunnels.

It wasn't the original owner's fault, they were going bankrupt and were being forced to sell off their assets

https://en.wikipedia.org/wiki/Pennsylvania_Station_(New_York...

Unfurnished ($950/mo) is still more than I pay for a ~2400 sqft house with 3 bedrooms and 2.5 bathrooms, with garage, back patio and yard.

The back patio has my own personal grill on it. It's getting rusty now, but it's about 8 years old, still usable, and only cost me $45 and some assembly time. My communal lounge rarely has more than 4 people in it, and none of them are creepy, annoying, stinky, or crazy.

My home is, however, a 67 hour walk from the nearest metro train station. So they got me on that one.

One of the solutions to a dearth of housing in the major cities is to convince more people to live somewhere else (lower local demand). But that requires employers to have their workplaces somewhere else. If you are starting a new business, please try to be aware that you will end up paying a large fraction of the combined cost of all your employees' housing, in the form of higher pay expectations. That is a cost that you can easily cut without sacrificing much, just by setting up shop in places with cheaper housing. Alternatively, convince the expensive cities to levy a tax on businesses based upon the amounts their employees pay for their housing and commuting costs, to make that relationship more obvious.

Avoid San Jose, San Francisco, Los Angeles, San Diego, Sacramento, New York City, Seattle, Riverside, Washington DC, Boston, Miami, Denver, and Portland.

Consider Detroit, Pittsburgh, Buffalo, Indianapolis, Cleveland, Kansas City, Memphis, Cincinnati, Birmingham, St. Louis, Columbus, and Louisville. If you absolutely must have a world-class city, Chicago, Dallas, Houston, Philadelphia, Atlanta, and Phoenix are all reasonably priced candidates.

But let's not all pick the same city, or we just end up with the same problem in a different place.

We can make sure that prime locations which are idle are put into use, through land value taxation. If you saw the full extent of waste from all the craters of vacant or underutilized land, you'd be amazed.

Technically these micro-apartments are the solution, even with their seemingly outrageous prices.

The best bet is to flood the market with supply, and for an island that means going taller or going higher density.

Allowing the construction of smaller apartments, and the partitioning of older ones into smaller units. As I wrote in another comment, I do not consider 25 m^2 (260 sq ft) a _small_ studio.

Meaning you consider it a medium sized studio?

There's tons of apartments in Tokyo that are < 20m^2. In fact I did a quick search, didn't even filter by size, first page of hits is 14, 14, 39, 10, 14, 15, 15, 15, 15, 14, 13, 7.5, 7.5, 7.5, 7.5, 7.5, 15, 15, 15, 15

Here's one of the 7.5 ones http://www.chintai.net/detail/bk-C01005807000000000000025000...

at least it's only about $500 a month and it's actually downtown.

Also Hong Kong.

Note: As someone that grew up in a ~100m^2 house I desire a similar space but having spent 6 years in a 28m^2 studio and having visited a few families in Tokyo and HK crammed into tiny spaces I sometimes wonder how spoiled I am.

Yes, I would say medium sized. I lived in studios from 20 to 30 m^2 and I thought I had plenty of space. I had friends living in 12 m^2 in Paris.

Some RV's are nearly twice that.

Tax employers proportionally to population density of office location times employee number.

People flock to dense areas because that's where the money is. So incentivise the money to spread a bit.

As an individual, not much. Though I sometimes wonder what the rent landscape would look like if people with moderate amounts of money were more flexible in their neighborhood choice. A lot of these crazy high prices are driven by people wanting to be in specific neighborhoods. Sometimes driven by cultural niche, sometimes convenience, and sometimes mostly just race.

Not live in Manhattan seems to be the only answer for common folk, unless you like a few roommates.

Zoning - The proliferation of areas zoned R4-R6 in NYC is nuts. They should be removed in all but a few places - don't want to totally ruin the "fabric".

IMO, there's a lot of R7/R8 that could or should be R9,R10,R10X or other mixed use.

http://www1.nyc.gov/site/planning/zoning/zoning-map-table.pa...

At least in Manhattan you get decent transit.

It also highlights that just "build up" isn't a magic bullet for high housing prices in areas where a lot of people want to live. In any given location, you can always do more building but, in some places, there seems to be almost insatiable demand.

If they hadn't "built up", prices would be much higher than they are now.

Or not, because there would be a lot less business transacted in Manhattan as well without skyscrapers and therefore probably less demand to live there.

But I'm not arguing your basic point. I'm just saying that you can have a lot of high rises and still have very expensive housing. Building more tall residential buildings may indeed be part of the answer to astronomical rents in a given city but they're not, by themselves, the cure-all they're sometimes portrayed as.

Prices in manhattan & co are less than SF, and the rate of increase is in the single digits per year vs. the doubling we've had in 3-4 years here in the bay area. That is why it's not much of a price shock for NYC.