What it takes to be middle class in NYC...

Parent Cafe
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<p>[N.Y.C</a>. so costly you need to earn six figures to make middle class](<a href=“http://www.nydailynews.com/money/2009/02/05/2009-02-05_nyc_so_costly_you_need_to_earn_six_figur.html]N.Y.C”>http://www.nydailynews.com/money/2009/02/05/2009-02-05_nyc_so_costly_you_need_to_earn_six_figur.html)</p>

<p>[The</a> middle class crunch: ‘Trapped’ even with ‘very decent living’](<a href=“http://www.nydailynews.com/money/2009/02/06/2009-02-06_the_middle_class_crunch_trapped_even_wit.html]The”>http://www.nydailynews.com/money/2009/02/06/2009-02-06_the_middle_class_crunch_trapped_even_wit.html)</p>

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<p>Interestingly, I just finished with my company’s board meeting today. Our directors are all successful businessmen (one woman SrVP) (CEOs in a number of cases). However, they are unpretentious and practical people. One of them commented on the $500K salary cap imposed on the bail-out companies, saying “Who can live in Manhattan on $500,000 a year?” He was totally serious. He said they won’t attract top executives with that pay.</p>

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<p>[The</a> Wealth Report - WSJ.com : What It Takes to Be ‘Rich’ in Your Town–Part 2](<a href=“http://blogs.wsj.com/wealth/2008/10/15/what-it-takes-to-be-rich-in-your-town-part-2/]The”>http://blogs.wsj.com/wealth/2008/10/15/what-it-takes-to-be-rich-in-your-town-part-2/)</p>

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<p>The average rent for a one bedroom apartment in Manhattan is $2800. According to the news last night - that’s 50% higher than the next most expensive city - San Francisco. If you need a larger apartment for a family you’re looking at $3500-$4000 minimum per month. A place to park your car (if you even have one) can cost more than most people pay in rent in other cities. Then factor in higher costs and taxes. Do the math - it costs a fortune to live even a middle class lifestyle in NYC.</p>

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<p>Are rents going down yet in Manhattan?</p>

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<p>It all depends. I have one friend who lives in rent controlled apt and sends his kids to selective high schools. It all depends. If your kids can not get accepted into one of the competitive high schools, there are very few areas you can live. You are virtually forced to move to suburbs. </p>

<p>Dstark – somewhat, but only the rents that were astromonic to begin with.</p>

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<p>My daughter rents a place in SF and says rents are dropping slightly.</p>

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<p>Salary cap is fine. If they don’t want to live in NY, that’s fine too. Hopefully that will spread jobs around the country where there are less expensive places to live.</p>

<p>Living comfortably shouldn’t involve robbing the rest of the nation blind.</p>

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<p>I live 25 minutes from downtown NYC. We make less than 100K, live comfortably, and save money, too. Maybe those execs could be my neighbors.</p>

<p>Naaahh.</p>

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<p>There are plenty of places on the NY side where you can live for less too.</p>

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<p>How much you pay for your apt. in NY depends a lot on when you moved here, and whether your place is rent controlled or regulated. So, newcomers tend to move to the outer boroughs, but you’ll still find oldtimers in expensive Manhattan neighborhoods where the newcomers spend 1 million and up (for purchasing – the rich tend to buy).</p>

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<p>Yes, rents are coming down.</p>

<p><a href=“http://www.nytimes.com/2009/02/01/realestate/01cov.html?_r=1&em[/url]”>http://www.nytimes.com/2009/02/01/realestate/01cov.html?_r=1&em&lt;/a&gt;&lt;/p&gt;

<p>NYC is a unique real estate market. Anyone who can buys fast because as you can see, renting without building equity is crazy. The biggest obstacle is that the most desirable buildings will not allow large mortgages. Some insist that you pay up to 80% in cash. Folks can get a mortgage later on, but they must show they have that much cash upon purchase to get into these coops and condos. So in times like these the market doesn’t crash as dramatically because owners are much less leveraged.</p>

<p>Got to believe things are about to change…</p>

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<p>“A New Yorker would have to make $123,322 a year to have the same standard of living as someone making $50,000 in Houston. In Manhattan, a $60,000 salary is equivalent to someone making $26,092 in Atlanta.”</p>

<p>There have been many threads on CC where posters question how someone making $100,000 - $150,000 a year can’t “afford” to send their kids to a $50,000/year school without aid. And they can’t believe the “cost of living” would eat up so much of what appears to be a very high income. </p>

<p>No need to take out the violins for people living in Manhattan…they could certainly move to South Dakota where they wouldn’t need to make as much money to live comfortably and kids could probably get into reach colleges due to geographic diversity…but just wanted to point out that money doesn’t necessarily go as far everywhere in the US.</p>

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<p>^ Sure, they could move to South Dakota, but they couldn’t keep the same jobs. Their cost of living would drop dramatically, but so would their salaries. think of all the jobs available in Manhattan that simply aren’t available in other parts of the country. So moving to South Dakota wouldn’t really solve the problem…
I don’t see why these people have to live in Manhattan. My parents work in NYC, but we live on Long Island. Only takes my dad about 30 mins to get to work in the morning, and it’s only 15 minutes by car! Not a big deal.</p>

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<p>Really. 30 minutes door to door from Long Island? You must live right by the train station and their office must be right by Penn Station. I grew up in Nassau county and it took my Dad an hour and 15 minutes to commute to his job in lower Manhattan. But just the LIRR ride was 36 minutes (when it was on time). And to drive during rush hour - it’s going to take more than 30 minutes.</p>

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<p>The technology is allowing more people to live outside of NYC and still make NYC money. I worked from home with a PA company for 3 years. They lease an analytical application to many WS firms that’s too expensive for those firms to do it in house. The company is based in a very low cost area of PA (a very nice mansion goes for less than 200,000). I did everything remotely from my NJ house, only went in to NYC for client meetings.</p>

<p>I am back working in the city now. But many firms are allowing their employees to work from home. We have a lot more staff live further out, and work from home 2-3 days a week.</p>

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<p>Yep, about half an hour door to door. The Express train takes us about 24 mins to reach Penn, plus he works on 36th St…he always takes the express, so it’s pretty quick.
I know what you mean though about the longer commute to lower manhattan - I go to NYU and it takes me 43mins to 1 hr to get there (depending on time of day, local vs. express, how close the building is to the train station).</p>

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<p>As Garland had expressed, there are places in and near NYC where families can live for under $100K. My youngest goes to a Catholic school outside of NYC, another goes to a high school in NYC. Many of their classmates are from families who make under $100k a year. Yet they are very much middle class or upper middle class. </p>

<p>Where it becomes difficult is for someone who is moving to the NYC area from someplace with a far lower cost of living and tries to replicate it here. You just are not going to get as much for your money. </p>

<p>When I went to college, some of my dormmates had families in NYC who lived in apartments that were much smaller than what I considered typical for a middle class family. However, it was no big shock. My parents where in a 3 bedroom garden apartment that was not in a city at that time, and though square footage was more, it wasn’t that big of a deal.</p>

<p>There are a lot of wealthy neighborhoods around NYC and if you look at them as the norm, you can feel mighty very quickly.</p>

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<p>Sorry, left out the word “poor” after “mighty” in my last sentence.</p>

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<p>We moved to NYC for a number of reasons, and the additional salary was on that list. However, the main reason was the opportunity for H to move up in his field and to give him flexibility in jobs. In all but the largest cities, the field of work that ended up being his niche and specialty does not have many jobs. Unless a position is vacated, there is no job. When the company where he was working was making merger noises, it became clear that if they dissolved the department in the city where he worked, finding another job in his field would be difficult if not impossible there. In NY, it’s a wide open field. H was able to move around and get several jobs in the time we have been here. Most of his counterparts who decided to stay in smaller cities have ended up independent, and are having a very difficult time now. Only in NYC is there a lot of jobs in his field. It was a good move for us financially, and without it we would not have been able to afford private schools for our kids. </p>

<p>The downside to this is that the housing is very expensive for comparable neighborhoods and square footage. We were foolish to buy as big of a house as we did. Had the housing market continued to rise or stay steady, we would have done well, as we had planned to sell about now with most of our kids now out of the house. But the market, as you all know, did not turn out as we had planned. </p>

<p>So, there are a number of advantages to working and living in an expensive area. There are the disadvantages also. One of them is that financial aid does not proportionally increase for cost of living in your area.</p>