New York City Prices Make $100k Salary Feel Like $36,000

https://www.bloomberg.com/news/articles/2023-03-15/new-york-city-prices-make-100-000-salary-feel-like-35-000

by malshe • 3 years ago

44 150 3 years ago

bloomberg.com

malshe7• 3 years ago

https://archive.is/Zriun

malshe7• 3 years ago

The full list of 76 cities is available here: https://smartasset.com/data-studies/dd-what-100000-is-worth-...

As a proud Texan, I am very happy to see so many Texas cities ranked high on affordability. I often hear people say we should also consider the quality of life in expensive cities. Although I agree that quality of life on standard metrics might be better in NYC, SF, or Honolulu, I would rather save my money living in Texas and take vacations to pricy places.

Ancalagon3• 3 years ago

Crazy to me how expensive my home state of AZ has gotten in the past few years. Growing up my friends and I believed it would remain cheaper than other states due to the hot weather, but homes prices have trended very high in the last few years for many of the more desirable areas. I feel like AZ used to be in the top ten for lists like these.

qball• 3 years ago

Growing up my friends and I believed it would remain cheaper than other states due to the hot weather

Interestingly, Arizona in particular is famous for its "snowbirds"; Canadians (and likely those living in the northern US states as well) tend to buy houses there to get more than 4 hours of sunshine in the winter.

neilv• 3 years ago

How are people in Arizona thinking about climate change? Does it seem rational (for people planning to live at least a few more decades) given the current state of science?

https://en.wikipedia.org/wiki/Climate_change_in_Arizona

malshe7• 3 years ago

If AZ used to be in the top 10, it has certainly fallen down a lot as it is now in 40s. Interestingly, Boise also shows up near AZ cities, which I guess happened due to the Californians moving there during the pandemic.

jeffbee4• 3 years ago

Texas, with the notable exception of San Antonio, builds housing at an exceptional pace compared to coastal cities. That's their big affordability secret, and many big cities in Texas have plenty of cultural amenities. Houston, where I lived before moving to SF, has a symphony and opera and ballet and museums, food and entertainment and dancing and all that. And in my experience there you can participate in the culture as a normal person unlike in SF where you are always bidding against hundreds of literal billionaires.

malshe7• 3 years ago

For me having a large house close to my workplace is a huge game changer. I get to spend a lot of time playing with my daughter outside on my property. I play pickle ball, jump on trampoline, etc. all on my property while living 15 minutes away from my office.

tayo422• 3 years ago

Living for vacations feels just like living for the weekend. And in the US how many weeks is that really? Feels unfullfilling.

explaininjs2• 3 years ago

They didn't say they were "living for vacations", just "saving money and taking vacations to pricier places". They could very easily be living for the moment, enjoying every day, and still taking some time to go out exploring other more expensive areas now and then.

It's a common fallacy of the new yorker to think they're the only one who has figured out living, and everyone else wants to be where they are but can't afford it. (not saying this was you, but it's something I've heard many a time)

xwdv2• 3 years ago

In New York City you should be making at least $150k to $200k for a decent life IMO. If that’s not you there’s no point living there, but you can certainly commute there to work the menial jobs if you’d like. Inevitably someone has to do them and it won’t be the $200k+ residents, so job opportunities should be fairly plentiful.

javanissen7• 3 years ago

I live in Midtown, make $130k and there’s tons of money left over. I have friends from childhood who live in Brooklyn, make <$40k and do fine by just having some roommates. The paradox is that NYC, despite having a bunch of expensive stuff, is also very easy to enjoy for cheap due to the public amenities.

drewbeck• 3 years ago

And $4 egg n cheeses!

zug_zug2• 3 years ago

I know people who "do fine" in NYC making ~40k by which they mean they "pay all their bills." Unfortunately they are NOT on track to have >1.5million saved up by retirement (as is projected to be necessary).

halfmatthalfcat2• 3 years ago

Even at that salary, you aren't buying in the city. At least, you aren't buying close to the city. Jersey City, Upstate, East Queens/BK (Flushing/Bushwick). And even THEN, you're buying shoeboxes/places that haven't been updated since the 70s/80s.

logicalmonster• 3 years ago

In New York City you should be making at least $150k to $200k for a decent life IMO. If that’s not you there’s no point living there,

People can have a pleasant life in an expensive city making far, far less than that IMO.

Just to be contrarian, there's more than 1 valid life path, but I'll make the totally opposite argument than yours. People who can't make a lot of money should consider living in a big city, and people who can make a reasonable amount of money should try and live outside of it.

Here's the argument.

People who can't make a lot of money anywhere won't likely ever be buying a house anyway regardless of where they live, so they'll fit into the rental culture in the city very well. If you're not making a lot of money, you won't be able to frequently travel regardless of where you live, so living in a big city is an advantage as it at least gives you an opportunity to experience a bit of global culture, have friends from around the country/world sometimes pass through and visit you, and gives you an option for an occasional fancy dinner out or tickets to some event when you can save up enough without thinking about a long trip that you don't have time for and can't afford. Ok, maybe you won't be going out for a fancy dinner, Beyonce concert, or Knicks game every single week, but you can save and plan for that once in a while and it's a realistic subway ride across town if you want it. A poor person living in a big city can have experiences that they wouldn't be able to logistically arrange otherwise.

But if you are capable of making a reasonably solid living, it makes more sense to stay out of the city. First, you'll likely be able to afford your own home comfortably. Even very high-earners can't afford to ever buy much more than a nice and clean and relatively roach/mice-free shoe-box in NYC, but you can live like a near-king in a smaller city making anywhere in 6 figures and can buy a massive home with all of the space needed for just about any hobby. A million dollars can get you a near palace outside of a major city, whereas a million dollar home in NYC is still depressingly small. And if you're making money and have your own home, you have the ability to travel anywhere you want when you're jonesing for some nightlife, beaches, gambling, entertainment, etc.

The uber-rich can afford to have homes in multiple towns and cities and can afford lots of space and an uber-comfortable life in any expensive city, so this analysis doesn't matter for them.

ashwagary2• 3 years ago

"Taxes are a particular point of concern: state comptroller Thomas DiNapoli has cautioned against raising taxes further as New York’s may already be pushing out wealthy residents, who make up an important revenue base."

Doesn't pushing out the wealthy reduce cost of living? I heard NYC has a lot of vacant residential properties held as investments.

shagmin• 3 years ago

I think you're describing a different thing. Those vacant residential properties could be owned from someone overseas who has never been to NYC.

I interpret pushing out wealthy residents to mean someone moving to Florida and living there most of the year to avoid paying NYC income taxes, even if they choose to keep their NYC condo. NYC suffers a drop in tax revenue and the housing supply doesn't necessarily get better.

treeman794• 3 years ago

New York tax collectors are incredibly aggressive about pursuing this kind of stuff.

mcntsh10• 3 years ago

What is not in dispute is that the richest New Yorkers pay most of the income tax the city collects. The 41,000 filers in the top 1% pay just over 40% of all income taxes. The 450,000 in the top 10% contribute almost exactly two-thirds of the city’s income tax revenue. The remaining 3.3 million taxpayers pay the final third.

https://www.thecity.nyc/economy/2022/12/6/23497265/nyc-tax-d...

vanilla_nut5• 3 years ago

Oddly, NYC has very low property taxes: https://leavethekey.com/blog/property-tax-new-york-city-2021

About .88% of assessed value on average, something like half the rate of the rest of New York State and less than half the rate of most of the Northeast!

So it's actually a pretty cheap place to buy an investment property. Seems strange to me that NY puts so much of its tax burden on renters and so little on owners.

ashwagary2• 3 years ago

Seems strange to me that NY puts so much of its tax burden on renters and so little on owners.

Well spotted, this would indeed solve a lot of affordability issues.

xyzelement2• 3 years ago

I think it seems strange to you because you don't understand, but to be fair I didn't really understand this until I moved out of the city and bought a house on Long Island.

My property tax here is almost the same as my city income tax was.

In NYC as a renter - I pay my income tax. My landlord pays the same rate on his rental income (you probably forgot this part) AND the "low" real estate tax you are referring to.

If I own my place, I am doubly fucked because I pay the high income tax and the RE tax.

The only people who come out ahead under the NYC model are those who live in a place they own but don't have any income. I think it's a very small demographic.

xyzelement2• 3 years ago

I don't have the stats handy but the numbers of who pays taxes are staggering. Something like top 10 percent of earners pay 60 percent of tax revenue and the next 10 percent pay the next 30 or something like that.

So if NY loses just it's wealthiest, it's absolutely fucked.

mcntsh10• 3 years ago

One thing I was not prepared for was the taxes. My total tax bill comes out to around 39% of my pay check... paying $2k/mo in state/city taxes alone.

Shocking, coming from Germany, where the tax (minus health insurance) was almost exactly the same percentage, but I get a *lot* less for it.

malshe7• 3 years ago

39% is insane! The infrastructure is crumbling so not sure what are they doing with all the money

giraffe_lady• 3 years ago

cops mostly

darth_avocado• 3 years ago

More city employees for more arbitrary rules they make up to make your life more miserable and get more money from you.

rufus_foreman• 3 years ago

At the federal level, if https://www.nationalpriorities.org/budget-basics/federal-bud... is to be believed:

Social Security, Unemployment & Labor: 39.63%

Medicare & Health: 22.67%

Military: 10.91%

Education: 6.21%

Interest on Debt: 4.27%

Veteran's Benefits: 4.27%

Everything Else: 12.04%

ews• 3 years ago

As somebody who also moved from Europe: how high US taxes are compared to how little you get is shocking.

zwieback• 3 years ago

That puts the discussion that we should pay less for "defense" into perspective. And make our healthcare system more efficient, those two knobs are what I'd like to turn.

ActorNightly2• 3 years ago

Area dependent. There are plenty of places in US with way less taxes.

The issue with places like NY, LA, SF, is that they are currently transitionary places. Its a place where you go work for a bit to build up your career, then leave to go somewhere with a much cheaper cost of living, significantly below EU for the comparatively same standard of living (unless you are on the lower end of the income scale where you definitely get more in EU).

A small minority of people stick around because their respective industry is in those cities (finance for NY, entertainment for LA), but they also get compensated way above the median/mean.

In EU, on the other hand, cities are places where people live normally at all income levels.

2OEH8eoCRo0• 3 years ago

I'm not in NY but I think that taxes hit the middle class too hard. They really need to figure out SS as well. I wouldn't mind paying for it if I were guaranteed to receive it but I have to save assuming that I won't.

slg• 3 years ago

They really need to figure out SS as well. I wouldn't mind paying for it if I were guaranteed to receive it but I have to save assuming that I won't.

You are guaranteed to get it by law. The problem is that the law can be changed to remove that guarantee. There isn't much we can really do to prevent that.

The narrative about SS running out of money is about the desire/need to change the law, not that the guarantee can't/won't be met.

treeman794• 3 years ago

You will get it.

You’ll just be extremely old, far beyond working age, and it wont keep up with actual inflation, so you can’t live on it.

Should see social security disability.

Got to be able to live for a year or more on no income at all while case managers decide that your horrific injuries don’t interfere with ability to work.

twblalock11• 3 years ago

This is why the debate about taxes in America is not like it is in Europe.

Europeans get a lot more for their tax dollars than Americans.

If you add up federal, state, local, and property taxes, the tax burden of many Americans is just as high as what Europeans pay and we don't get free health care or anywhere near the level of social safety net that Europeans do. The money is being spent inefficiently.

When you see Americans vote against tax increases, don't be tempted to think it's because we don't want better government services. We vote against tax increases because we know we don't get good value for the money we pay, and paying more isn't going to fix that.

it_citizen3• 3 years ago

Turns out it costs a lot of money to have a « war on drugs », « war on terror », « war on crime » and so on.

Not sure about the results though.

hotpotamus• 3 years ago

The US has six public single-payer health systems (I forget them all) and spends more on them than European countries do on their universal healthcare systems without providing universal healthcare.

I suspect that private profits are much higher in the US though, since that is supposed to be the incentive. I know that I would pay quite a bit of profit to someone in order to save my own life, and I imagine that people with children feel similarly about their lives.

It's not any great secret either, listen to Obama talk about healthcare back in the day, and the phrase he always used was, "bend the cost curve". I would think the obvious solution would be to set up one actual single-payer and then use monopsony power to force costs down. It would probably mean less profit for those sellers though.

gonehome• 3 years ago

I’ve heard this a lot, but I don’t buy it.

My friends in London lose at least half their equity value to taxes, have to buy 1000yr leases, and seem to be generally poorer than their counterparts in the US.

Anecdotal, but the US is a rich country with I suspect a lower lower bound and a higher median quality of life per dollar.

Before you say the UK isn’t Europe it’s even worse in the EU imo.

the_70x• 3 years ago

"free"

yankeefoxtrot• 3 years ago

Residents must pay NY state taxes (already high), and NYC has a separate city income tax that varies from ~4–10% depending on your bracket.

huehehue• 3 years ago

Do you have a source for that? The highest city tax bracket I can find is 3.867%

To be clear, it's still ridiculous to pay hundreds of dollars a month extra just to live in the five boroughs but 10% would be unmanageable

kilroy123• 3 years ago

The crazy thing is with all the taxes we pay it _still_ does not cover the expenses and we go more and more into debt each year.

TSiege• 3 years ago

For the feds maybe, but not in NYC or NYS

vanilla_nut5• 3 years ago

It was shocking for me when I graduated from college and moved to NYC.

Sure, it's cool to get a job paying six figures in NYC out of college. But once you've paid your:

- rent (first and last up front, ofc)

- broker fees (often > 1 month's rent!)

- state taxes

- city taxes

- federal taxes

- social security

- massively inflated city grocery prices

- student loan dues

...you realize that you basically only exist to launder money between corporations. It especially sucks when you're just trying to start out with a net worth of less than zero and you're still paying this massive tax rate.

And before anyone mentions student loan interest deductions and federal tax deductions for state and local: they make very little difference, in my experience. Maybe others have figured out how to make that system work for them, especially before the Trump SALT deduction cap.

NYC is a cool city, of course -- probably the best city in the US -- but I'm not sure it's worth the 50% tax rate for decidedly middle class earners. At this point I'd have to make north of $400k/year to justify moving back to NYC because of those insane taxes.

yieldcrv• 3 years ago

The American system incentivizes financial risk and that is our growth engine.

If you take the correct risks you basically don't pay taxes.

If you try to avoid risk, you pay the highest taxes. So if you are just trying to have income and savings, enjoy your 39% taxes and nothing to show for it.

GaryNumanVevo• 3 years ago

Yeah that was something that surprised us after moving to Amsterdam, we have a slightly smaller tax rate (due to Netherland's 30% ruling for US expats) than we did in California, but the services here are SO well funded. Healthcare is essentially free, services for families like childcare / schools / etc are world class and free, the roads and biking infrastructure are amazing here as well.

The peace of mind that if we have a medical emergency that we won't have to pay 5 or 6 figures out just for an ER visit + surgery is HUGE.

lisasays5• 3 years ago

It's hard to evaluate these numbers, without full access to the decision tree and source dat) they are working with.

One very common mistake people make in evaluating NYC living costs is to work with rent statistics provided by ... high-end real estate brokers. For example in an another Bloomberg article that the story links to:

The median rent on newly signed leases last month was $4,095, down just $2 from January, according to appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate.

Everyone in NYC knows this just isn't true -- a very large portion of NYC tenants live in either rent-stabilized units, or in units not listed on the MLS system that these brokers work with (and from which they get these numbers from).

Not surprisingly, these brokers have a vested interest in propping up the idea that "you just have to" fork over $4k a month for rent in NYC.

Now, rent stabilized units of course aren't exactly easy to get -- and you may not want to live in many of these units. But on a strictly factual basis - the true median rents in NYC are far lower than the numbers provided by these high-end brokers.

Finally, there's the fact that NYC is one of the few cities where one legitimately does not need to maintain car at all (easily a $6k-$10k savings every year). The article simply mentions "transportation" but completely glosses over this crucial distinction between NYC and other cities.

mcntsh10• 3 years ago

AFAIK, being a rent stabilized unit has no bearing on the actual rent cost, it just means landlords cannot raise the rent above a certain percentage after contract renewal. My 1br apartment is almost $4k/mo and it's rent stabilized.

lisasays5• 3 years ago

Yeah, there's a certain number of stabilized units which are "high-end" (for those earning 80-100 percent of the local median income), whose rents scarcely differ from those of market-rate units.

But I assure you the vast bulk of stabilized units have grandfathered rents from way back, and these are far below market. Which is why the industry always fights tooth-and-claw to get these restrictions lifted or lessened, any time they get half a chance.

malshe7• 3 years ago

I am curious, how big is this difference between the rents?

lisasays5• 3 years ago

I don't have the numbers on the back of my hand, but they can be far less (often less than half) of the market rate - please see the sibling comment I just posted about this.

jeffbee4• 3 years ago

Rent-stabilized units are about half the housing stock but much less than half the market because they never turn over. As such they are irrelevant to new arrivals or people weighing the possibility of of moving there. Anyway I do not find the $4095 number very shocking. In Berkeley where I live the median new lease for 3-bedroom rent-stabilized apartment, and these are far from "luxury" as they are all at least 40 years old, was $4300.

lisasays5• 3 years ago

As such they are irrelevant to new arrivals or people weighing the possibility of of moving there.

Of course there are contingent factors involved. I'm just saying that factually, the median rent numbers put out by the brokers are plainly bogus.

vanilla_nut5• 3 years ago

Living without a car in NYC definitely helps with affordability! I saved several thousand a year on that. But you should also account for the following costs:

- subway fare ($120/mo, possibly pre-tax on a commuter card)

- rideshares or rental vans for occasional large item pickups

- rental cars or unreasonably expensive Amtrak fares when you want to leave the city or visit family (the rest of the USA requires a car, ofc)

After those costs, you're saving more like $1-5k/year. You can avoid them if you walk more than average or never get out of the city, but in my experience there's a bit of a mental health toll if you spend many many months in NYC and never get out of the city, especially if you have friends and family outside of the city.

lisasays5• 3 years ago

Right, one can dissect the true costs a bunch of ways.

Without access to the methods and date the article is drawing from, it's impossible to hold much stock in their conclusions.

GenerocUsername2• 3 years ago

Over the years I keep hearing a general sentiment that cities are more efficient places for humans to work and live than their rural alternatives.

If this was true, shouldn't efficiency make living there cheaper?

nkjnlknlk• 3 years ago

It is cheaper than having all of NYC live in the rural equivalent, yes.

GenerocUsername2• 3 years ago

Is it? Wouldn't each individuals expenses be lower? And therefore the total would also be lower...

jeffbee4• 3 years ago

It doesn't because of the constrained housing regime. All marginally available money flows to landlords. Anything that begins to cost less simply raises rents.

javanissen7• 3 years ago

Not if the supply dramatically outstrips demand. If you want to live in a walkable city in America with decent public transit (to the point where car ownership is optional), low to moderate crime, and lots of jobs, relatively few places meet that demand. If there were twenty American cities with the same economic abundance and amenities as New York City, New York City rent would be lower.

automatoney• 3 years ago

This was almost word for word my decision process when picking where to live. "I'm not going to buy a car, so I want to live somewhere designed for that, and I want to live somewhere with local tech jobs." I also don't like the heat too much, so that gives me a couple of cities in America, or I could move to another country.

twblalock11• 3 years ago

That general sentiment is unsupported by evidence and most of the time when you challenge it you get links to strongtowns.org which is a non-credible source run by a crank.

People constantly say that cities "subsidize" suburbs but when you look into it you find out that is only sometimes true, and that many of the people who do the most productive work in cities commute there from the suburbs, and that many of the world's most valuable companies, including all but one of the FAANG companies, are located in suburban areas.

Plus, if people really want to talk about "subsidies" they should admit that big dense cities get plenty of those too.

You'll also see a lot of commenters who think "suburban" and "rural" are the same thing, often without realizing it, to the extent that one particularly clueless comment I saw recently asserted that nobody in the suburbs had city utilities and all the houses had septic tanks.

Cities are actually very expensive to maintain, and they tend to have the worst concentration of problems such as crime and drug abuse, and NYC is one of the prime examples.

seanmcdirmid6• 3 years ago

and they tend to have the worst concentration of problems such as crime and drug abuse, and NYC is one of the prime examples.

Per capita drug use in NYC isn't as bad as many rural areas, where meth has become a huge problem. The fact is that more people mean smaller percentages can still mean lots of people.

Cities really aren't that expensive compared to the wealth they produce. Its just that with scale also means demand goes up, which increases prices because resources are still finite.

javanissen7• 3 years ago

Citations are needed here.

strongtowns.org which is a non-credible source run by a crank

I've yet to see a comprehensive takedown of the main points of Strong Towns that isn't addressed directly in the book. I don't think your argument amounts to one.

Suburban businesses can be highly productive, but municipalities do not directly benefit from this since taxes on business profits do not go to municipalities. They may indirectly benefit from higher property values - and therefore property taxes - near the business center, but in general the suburban development model spreads houses and businesses so far out (and splits them through zoning) that the maintenance burden on the city is still too high relative to municipal funding through taxes. Marohn devotes many pages to this in the book.

I'm not sure how Chuck Marohn is a crank. Is it because of the complaint against him from the licensing board? His PE license lapsed from 2018-2020. He filed to have it renewed [0] before he was aware of the Minnesota licensing board's complaint. He should not have called himself a PE while his license was lapsed, but I don't think it negates any of his arguments and I think it's a stretch to say he is deliberately misleading.

Cities are actually very expensive to maintain

Tremendously so, but some of them seem to do very well with defeasing those expenses (see NYC's significant budget surplus) [0]. The difference is that cities do not have a fundamentally broken development pattern that is guaranteed to always depend on external funding or growth.

and they tend to have the worst concentration of problems such as crime and drug abuse, and NYC is one of the prime examples

This is a complex conversation, and I disagree with your conclusion. There were 433 homicides in NYC in 2022 [2] and 8.5 million people [3], for a murder rate of 5.1 per 100,000 people. This is worse than that of Maine, Vermont, or New Hampshire, but similar to the murder rate in Wyoming (4.9), less than that of Texas or Montana (6.6 and 7.1), and significantly lower than that of almost the entire American South (7.8 to 20.5) [4].

To your point about drug abuse in NYC, I disagree. There were <2168 fatal overdoses in NYC in 2020 [5], which works out to 25.675 per 100,000 people. One look at the overdose fatality map [6] tells you that this is middle of the road, and dwarfed by rural states in the region like Vermont, New Hampshire, and West Virginia. The drug crisis in America is terrible, but urbanicity does not exacerbate it.

The right conclusion, I think, is that urbanicity does not drive murder rates or drug abuse - poverty, deprivation, lack of opportunity, and other factors do. This is why NYC is relatively safe despite being the most urban place in America, while other states and cities (hello Texas, Mississippi, Chicago, New Orleans, and Flint) of various levels of urbanization are much more dangerous. These places are poor, for reasons that are, ironically enough, frequently addressed by Strong Towns.

[0] https://news.ycombinator.com/item?id=27296177 [1] https://www.cityandstateny.com/policy/2022/06/new-york-citys... [2] https://www.nyc.gov/site/nypd/news/p00071/nypd-citywide-crim... [3] https://www.populationu.com/cities/new-york-city-population (not the best source, but seems close) [4] https://www.cdc.gov/nchs/pressroom/sosmap/homicide_mortality... [5] https://www.nytimes.com/2023/01/13/nyregion/new-york-overdos... [6] https://www.cdc.gov/nchs/pressroom/sosmap/drug_poisoning_mor...

toshredsyousay2• 3 years ago

How are you calculating how expensive a suburb is to maintain versus a city? A suburb can't exist without a city, basically by definition. A city would have fewer wealthy commuters without the suburbs, which would reduce the size of the economy, but ultimately a city can exist without suburbs albeit in a diminished state. You cannot say suburbs are cheaper to maintain than cities when they cannot exist without cities.

While it is true that wealthy people live in suburbs and commute to the city and contribute to the economy, the same infrastructure is generally more expensive in a suburb than a city because it has to travel longer distances between houses. That is just geography and physics. Picking up garbage for a building with 10 apartments is going to be cheaper per household then driving between 10 different houses, for example.

The relationship between cities and suburbs is symbiotic in some ways, but in many ways suburbs rely on exporting costs onto cities. Suburbs exclude poor people by design (zoning rules and housing supply restrictions), so that they don't have to pay for all the social services used by poorer people. And when you say 'city infra is more expensive', a huge percentage of the city infrastructure (e.g. roads, trains, sewers) is used by people who commute into the city when they are in the city. Very few people living in the city go and use infrastructure in the suburbs on a daily basis.

Imagine if everyone in NYC tried to move out to the suburbs, it would not be remotely feasible. They wouldn't have the social services for the poor and wouldn't be able to get the tax revenue to maintain infrastructure between houses while preserving the spread out distances between houses without dramatically raising taxes. The rich would then probably just flee somewhere else and take their taxes with them. Additionally, lower income people couldn't even afford the houses/cars needed to live there in the first place.

whywhywhydude• 3 years ago

It increases efficacy, but most of the efficiency gains probably goes to the landlords, property owners and a few lucky percentage who win the subsidized housing lotteries.

toshredsyousay2• 3 years ago

There aren't many places with the access to as many high-paying jobs and the desirable walkability of NYC. That makes demand to live here high, and then we have on top of that artificial constraints on building new housing. Additionally, the suburbs outside of the city also have artificial constraints on building housing, and generally other cities that could become alternatives to NYC also have artificial constraints on building housing (and also don't build enough transit). All of that makes NYC more expensive and makes cities remotely like it (e.g. S.F.) more expensive.

addcommitpush• 3 years ago

Landlords are able to capture the efficiency gains through higher rents. What makes it so much more expensive to live in NYC is not that (e.g.) construction costs are that much higher, it's because the land costs so much more because it is more desirable.

seanmcdirmid6• 3 years ago

If this was true, shouldn't efficiency make living there cheaper?

You make more money in cities, and it is easier to find a job. Living in a small town in Montana sounds great, until you realize that you can't find a job and are starving to death. Smaller towns and cities are cheaper simply because people have less money to spend on housing. But try going to Aspen CO or Jackson WY, and its crushing because so many rich people are living in those places and the only jobs to be had are low paying ones serving those rich people.

halfmatthalfcat2• 3 years ago

So hard to compare a lot of these places. Sure you'll take home a large share of your money living in Ft Wayne, IN...but you're also living in Ft Wayne. Relatively, taking home near 60% and living in Chicago is so vastly different than taking home 80% in Ft Wayne.

ianbutler2• 3 years ago

I moved out of NYC to Jersey City three years ago, largely because there was an immediate upside on my taxes. I'm still close enough and can easily go in when I want to via the path.

My friend who works as an engineer at Google was lamenting to me the other day how his 350k+ TC basically feels like nothing in NYC after federal, state and city taxes. He takes a 50% loss. Why would you want to continue living in a place that takes what is a top 1-2% earner for our age group (25-30) and makes them feel poor? And that is even considering RSUs since those are vesting monthly at Google now.

He's almost priced out even in Brooklyn, paying over 3k for his 1 bedroom. But if you don't want to live in some slum lord pre ww2 shit hole you need to be paying a lot.

I'm in the same earning bracket and I've been contemplating a further move because while Jersey is easier on the wage taxes, the property taxes are insane and make buying a house here deeply un attractive.

treeman794• 3 years ago

I pay 2700 for an acre in a highly desirable area in the south. Which is 1200 more than it was 4 years ago. But we have a huge flood of people coming from out of state that love how cheap everything is.

positr0n• 3 years ago

Where is this area?

1 acre lots 30 miles N/NE of Dallas in desirable areas with good school districts are well over $200k these days.

throwaway67344• 3 years ago

Why would you want to continue living in a place that takes what is a top 1-2% earner for our age group (25-30) and makes them feel poor?

Least out of touch FAANG engineer

ianbutler2• 3 years ago

You are not wrong, I am out of touch with normal people, doesn't mean I'm not going to continue to try and improve my position. I guess I should have said poorer.

Also I don't work for a FAANG but it's arguing semantics as they're around the same tier.

2c2c2c3• 3 years ago

My first job was at a startup for $95k in SF in 2018. This felt like the "peak" of rent here, where I was paying $2350/mo.

I'm kind of lost how this salary should feel like 36k/mo. To me this is a salary that reminds me of my childhood-- paycheck to paycheck, looming foreclosure from being behind on house payments, constant fliers from electric threatening to shut us off.

That isn't remotely what my experience was. I maxed my roth ira, paid into my 401k up to what my company matched, and had plenty left over month to month. I paid off the small amount of student loans I had within the year. I didn't have to think or care about what I spent money on. I went to bars weekly spending $12/drink. Work comped my dinners, and I ate out everyday for lunch.

Articles like this have created this perception online that you will starve to death on a salary like this in SF. I guess my question is, 100k here feels like 36k where?

throwaway67344• 3 years ago

These articles are written by people completely out of touch with your average American. The median household income in the US is around 70k.

2c2c2c3• 3 years ago

There are comments on this post that just suggest an ungodly level of consumption. Saying you can't live in NY comfortably on 150k salary. I buy $800 jackets and feel like a jackass, WTF are these people spending their money on to say this shit?!

twblalock11• 3 years ago

Yeah but were you raising a family on that money? Living alone, or as a childless couple, is remarkably cheaper than having kids.

seanmcdirmid6• 3 years ago

I lived in Switzerland for a couple of years between 2005 and 2007. I made like 65k CHF/year, which is not bad for back then for being a postdoc (at least), but my housing costs were high (because Switzerland is expensive). Still, I was able to save 50% of my salary, travel, and so on.

You can save money easily if you don't have wife/kids to worry about, and your income is reasonable, no matter how high the COL.

mint26• 3 years ago

This is good and useful for some purposes but over simplifies and leaves out important trade offs. It’s like treating cities as interchangeable fungible commodities like low quality coffee beans or flour.

For example, the premium some would pay to live near certain amenities or family. For example, being within easy weekend driving of world class skiing, backpacking and hiking.

If I was paid 100k and had to pay 10k to live near those amenities vs Nebraska, no question I’d pay. These are hard to factor into a ranking like this but without some consideration of them the list is of marginal use.

mcntsh10• 3 years ago

You can't really control for this because it's completely subjective.

mint26• 3 years ago

One could argue the price differences show how much people are willing to pay.

Think how much money I could save by moving out of SF. I am staying here.

If Leaving out a crucial aspects just because they are hard to quantify then it is easy to stray into the garbage in garbage out arena. That’s harsh, I don’t think the list is garbage I just think it needs to at least try.

xboxnolifes2• 3 years ago

But if you don't control for it, the analysis is meaningless.

New York City Prices Make $100k Salary Feel Like $36,000

Related Stories