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The Rent Actually *IS* Too Damn High

The rabbit head is aloft because this piece was inspired by an article in Playboy about the cost of living in the USA.

Let's be real about it. Living has become insanely expensive for people who have to rent, especially if they are in a major metropolitan area.

I'm sure that people who own their homes are also feeling some property tax pinches and other issues with maintenance, but the thing about owning is that it is yours. If you rent, that money gets paid and it's gone. No escrow, no chance to set up a mortgage if you need one for an unforeseen expense. Even maintaining the property for the landlord doesn't earn you anything more than your security deposit back when you eventually move out.

Everything seems to be working against the middle and lower class income families that are already struggling, not really to live, but survive. If you are a property owner, you have a major advantage over those just able to afford to rent. And really, you can rent your property out and get a payday that way! Yet another advantage.

In the Playboy piece, they focus strictly on the cost of renting, likely the biggest piece of the pie in everyone's budget these days. In the article, they state that it's expected that you are spending thirty percent of your income per month on your domicile. That might have been true in the 1990s, but since the emphasis on how great US cities have become (and there are some highly improved cities all across the map), suddenly, supply and demand rears its greedy head, and the costs have ratcheted up.

Look at this:

2 bedroom apt per hour.jpg

Exhibit A

The above map represents the amount of money, per hour, you need to make to be able to afford to pay rent for a typical two bedroom apartment in the 50 states, Puerto Rico and Washington DC. Not everyone needs or would want a 2 bedroom unit, but it's a good starting place to examine a family's needs.

The problem with this map is the averaging of the prices by state. Living in Rochester or Ithaca is nothing like the cost of Brooklyn or Manhattan, as one obvious example. So seeing the number $25.67 attached to New York doesn't really tell the story. But even scarier is this map:

Exhibit B

This map shows the number of hours, per week, you must work to afford a ONE Bedroom apartment on MINIMUM WAGE.

You will note that in no state can you work a 40 hour week at minimum wage and be able to afford an average one bedroom, and that's even in states where the minimum wage is higher than the Federal level. Closest to it would be Puerto Rico at 48 hours. Oh, but wait, Puerto Rico isn't part of the United States! Oh, but wait again! Puerto Rico is about to default on a whole bunch of debt. Not exactly the place to be when it comes to financial solvency.

And, as all New Yorkers know, what you get for your "average apartment" is questionable, at best. Where you live plays a part because if you live far from your workplace, there's a commute and that means both time and money.

Let's also keep in mind: there are only one hundred and sixty-eight hours in a week. So if, in New York, ninety-eight of those hours are just working, let's say your commute to work is an hour. That's an additional fourteen hours (I'm saying fourteen because you're not going to get to 98 if you're only working 5 days). Now, you're up to 112. How about time to eat? We'll assume you grab something on the commute in, and leave yourself an hour for dinner after your shift. 119. That leaves you with 49 hours - a good 7 hours of sleep each night!

Now, if you have to do anything - ANYTHING else during that week? Brush your teeth, get dressed, take a shower? We'll have to cut into your sleep time. It's the only free time available. And if you have a family of some sort? Well, let's presume you have no social life with this schedule, so that's probably not a concern.

I would argue that someone who has to live like this, just to survive? That's cruel and unusual punishment and that's unconstitutional. Hello, Supreme Court?


( 6 comments — Leave a comment )
Jul. 3rd, 2015 04:26 pm (UTC)
Jul. 4th, 2015 12:00 am (UTC)
The really obvious point is that there is no way anyone would even have the opportunity to work at a single job 98 hours at minimum wage. You would likely have to have two separate 50 hour a week jobs, which would likely be in two separate locations, requiring a commute of some length, or more likely 4 25 hour jobs, that way you aren't listed as a full-time employee and won't get any work benefits, but you'll still have to pay your way to those four locations and back home.

But even if you have a reasonable paying job, it's still really difficult. There's very little room for savings, and there's not much time for fun. In case you're wondering why your bus driver is drifting off to sleep in the middle of traffic, maybe this will help people understand.

I guess the question is what kind of profit the landlords are making and what are they actually doing to earn that sort of profit? It's an examination of a system that is well overdue...
Jul. 3rd, 2015 06:58 pm (UTC)
This is scary-fascinating.

Rental prices are obscene in Moscow as well (largest part of the reason I'm living with my parents in the apartment that we all own...)
Jul. 4th, 2015 12:08 am (UTC)
High rent changes lives. It disallows the natural progression of being able to live on your own at the time when you need/should be able to do that.

I suspect that any popular place to be, no matter where in the world it is, will have an issue with the cost of living there. But for a lot of people, this is a very bad time, and we need to work on making it better!

Jul. 4th, 2015 11:41 pm (UTC)
Is it too personal to ask what you pay in rent and for what? This entry may be public (hard to tell on the app) so you may not want to say. I know I talk about numbers in my LJ.

While I don't think the rent I'm paying now is particularly UNreasonable, it was recently raised nearly a hundred dollars/month. And it's definitely unreasonable to have rent go up that much every year.

My friend in FL, in Hollywood, FL, I think she lives in, she said her rent went down $13. But she also lives in a complex with a salary cap. (You can't make more than X to live there. Though there are allowances of course if you start making more money. They won't kick you out. I don't really know the specifics of the rules though.)

I thought NY had rent control rules.


For some perspective, I make a little (very little) more than Exhibit A's Two Bedroom Housing wage for Texas. I live in a suburb of Dallas (a nicer one). And on what I make, I could afford to live in a two bedroom ... but I would be "house poor" or "apartment poor" as the case would be. (And this as a single income, no kids household.) Once you factor in just other basic living expenses (food, for a family that would need a two bedroom apartment; renters insurance; car payment; car insurance; cell phone; internet; savings...), there's really not a lot left over to have a life.

But that's for apartment renting. Renting a house - at least in the market here - houses in this area rent for 2x-3x times what the mortgage is. So you could buy two houses and rent one out and use the rental money to pay for both mortgages.. and maybe even have a little left over.

Edited at 2015-07-06 12:31 am (UTC)
Jul. 6th, 2015 11:56 am (UTC)
Sorry for the delay, but I was hoping for a more clearly defined answer... See, right now, the NYC housing regulations are potentially being changed, and could be changed drastically, but, of course, with the holiday weekend, nothing has been done.

Here are the basics. NYC's "rent controlled" and "rent stabilized" apartments are in danger of losing that status because the law that kept those rules in place expired June 30th, I think. City council members put off making a decision about this even though they knew the law was due to expire. This makes me believe they wanted the law to expire, and to change/renegotiate/dismantle it.

Truth is, with "rent controlled" apartments, some residents are paying a surprisingly small amount for their rent, compared to "market value" apartments that are sometimes 5 or 10 times the cost! It's one of the peculiarities about NYC apartments. Same building. Same apartment floor plan. One floor above or below. Completely different rents.

The thing about this is that in order for a landlord to be able to raise their rent to "market value," the landlord must make improvements to the building and the apartment itself, and small landlords aren't always willing or able to do that. This is why the banks are so frightening. They have all the money and they can just sit on apartment buildings, renovate them and then charge those exorbitant prices, which means less and less available housing for people who are in a specific price range.

The killer is that the people with these "rent controlled" apartments are not the ones who "need" them. They are mostly people of means who have also been able to salt away all that money they didn't need to pay in rent. So, again, no relief for the working class here.

Also, people can leave these apartments in their wills to their children and grandchildren, meaning that nobody else has a chance to get that sweet deal. Clearly there are some who are able to live in NYC, in a nicely sized apartment, in a good neighborhood at an affordable price.

More recently, builders have been wanting to put up even more luxury condos, additional glass towers for people to buy housing. But, the compromise deal is that some of the units in these luxury edifices MUST be "affordable." Now, granted, they aren't all 5 figure a month units, but none of them are something that someone working as a sales associate at a retail store, or even a waiter at a fairly busy restaurant could afford comfortably.

The big question is where will all the service industry people, the busboys, the clerks, the people that make New York what it is, live? We've already lost so much of the city to this higher rent situation, and I'm talking about businesses that have been in place for decades, it's not clear where we are going.

As for your Texas scenario, I wouldn't doubt that people are doing similar stuff with their apartments, here. When the city was still on the upswing, back in say the mid to late 1980s, apartments were for sale and some people bought them - roughly 80-120K was the price range I think. And the banks were there to help you finance.

Now, I'm sure that some of those owners are renting to others and are doing well. Since the market is flooded with expensive apartments, a landlord here isn't going to be able to gouge you like they seem to be doing in your neck of the woods. But then again, the BANKS are the landlords in a lot of cases here, and they aren't at all interested in renting their property until they get the price they want.

15 years ago, I predicted that eventually, Manhattan would become a gated community. It still feels like that could happen. Or maybe it's already happening...
( 6 comments — Leave a comment )

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