Well, that settles that.
We already knew that way too much of our income was going to rent. Just last year, New York City came in as second-most expensive place to raise a family. But those statistics suddenly pale in comparison to Brooklyn’s latest crowning yearbook superlative, Most Unaffordable Place to Live in America.
Real estate data company ATTOM data solutions released their third 2016 quarterly report today, which ranked cities on a scale of unaffordability by comparing incomes with market rate housing and closing deal costs. Brooklyn won out by a landslide, with 123.5 percent of median income being the going rate for a house. Santa Cruz came in second, at 111.1 percent.
Marketwatch, who first reported ATTOM’s findings, put it in laymen’s terms: “A person earning the average salary in Brooklyn cannot afford the average home there — even if he or she could spend his entire salary (and then some) on housing.” Well, guess we’d better start commuting from Cleveland. [NOTE: This post has been updated.]
Markets with the highest closing costs as a percentage of annual wages were all in the New York metro area, but Brooklyn’s whopping 47.2 percentage toppled that of Manhattan, at 42.6 percent.
“In each of these three cases, many people — priced out of the Manhattan, San Francisco and San Jose — are moving from the pricey city center to Brooklyn, Marin County and Santa Cruz, respectively, which is pushing prices there up,” ATTOM’s senior VP Daren Blomquist told Marketwatch. “Meanwhile, wages in those counties aren’t keeping pace with the home price appreciation, which makes these three areas the most unaffordable in the nation for residents looking to buy.”
Buy is right. As in buh-buy, future dreams of owning.
The rental market shows equally dire statistics. StreetEasy’s latest market rental report confirms “growth slowdown” in 2016, but only at the top. In other words, since there are more luxury units than there are people who can afford them, competition in the market is easing up. But also, this:
By contrast, rents for the least expensive Manhattan rentals grew twice as fast, increasing 4.4 percent.
Competition is tighter than ever at the bottom level for an increasingly scarce crop of affordable units. Brooklyn may be a borough, but it does leave us wondering: “Whose city?”