New York City Maintains its Ignoble Crown
For a good number of years now, renters of NYC apartments have had the extreme displeasure of paying the highest rents in the country. A new report suggests that the city is entering 2008 with a continuing hold on the unfortunate and smudged crown which signifies its role as the most expensive city for renters in the country.
The new report by the major California real estate investment firm, Marcus & Millichap suggests that, at least insofar as median rental rates, NYC apartments far surpass those any other city in the country. The median, for those that always get them confused, is the number that is number that occurs most often in a set. So, when we say New York City’s apartments cost a median monthly rent of $2,922, what we are really saying is that more New York apartments cost $2,922 for rent a month than any other price. It’s a seemingly small difference between average or mean rental rates, but it’s an important difference.
Median rates are a better representative of what the typical person pays, because it’s not thrown off by the super-high numbers the luxury rental apartments, in this case like the mean rental rates would be. It’s a funny thing about New York City, though: In many cities, 2,922 dollars would get you something approaching a luxury apartment.
Here, though, it gets you the median. Can’t you almost feel those dollars just pouring out of your wallet, like a crisp waterfall on a spring day? Sometimes I think landlords in the city just sit outside and watch people walk in and out of their buildings and make a cash register noise inside their heads, ka-ching, ka-ching, as their tenants walk by.
The next closest city was San Francisco, but its median rental rate was a full thousand dollars less than New York City. It stood at just $1,904.
In fairness to the equally cash-pressed San Franciscans, though, these numbers are a bit deceiving. New Yorkers tend to cram more people into their apartments, so even though the apartments themselves are more expensive, those that life in the City by the Bay actually pay more per person.
The report notes that there is more than just supply and demand driving rental rates in the city up. Of course, New York City and San Francisco’s low vacancy rates force prices upwards, but the regional inflation stemming from the high income of New Yorkers and San Franciscans is what makes rental rates so astronomically high in these two cities.
Of course, while this means that rental rates are acceptable for high income earners, it means that the working class in New York City is pressed harder by the high rental rates than in any other city in the country.
Gea Elika is a freelance writer specializing in business, politics and economics. He holds a B.A. in political science and will begin his PhD studies in political economy and public opinion next fall.
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