Western New York (Buffalo, Albany, Jamestown: real estate, mortgage, how much)

[zanna vaida]

Why do you think properties are very affordable in Western New York?

[homeward bound]

1) Economic difficulties, particularly the loss of well-paying manufacturing jobs, have to be the #1 reason. For over a century, these great jobs attracted people from all over the country and all over the world. It was a way into sure survival, the middle class, and sturdy HOPE for many unskilled workers. You could really root yourself in the American dream in this region's once-abundant great manufacturing jobs. Yet such jobs are almost entirely gone now. You can no longer walk off the immigrant boat, or out of the local high school, and into a well-paying, secure, good-benefits job anymore there, or probably anywhere. First such jobs went south, and then they went overseas. And from the loss of these kinds of jobs comes also the relative difficulty of finding well-paying retail, professional, and white-collar jobs. And from all this, when added to the urban middle class's nationwide flight to the suburbs in the 1950s and 1960s, comes serious urban decay. Even in such small cities as Jamestown, Salamanca, Olean, etc. If you don't have a good economic base, then little will grow or even survive well atop whatever base you do have.

2) The fact that Western NY's decline has been going on a long time, too, in many if not most places. Many areas peaked in the 1950s. Others peaked even sooner. So the decline has been going on for 30, 40, even 60 years, in many places. That's a long time for economic inertia and decline to pull or hold down housing values.

3) Also, the fact that the housing stock tends to be fairly old matters here. I've often noticed that, all over the country, if an area declines economically, if its housing stock is also older, it declines more drastically. It's as if people semi-consciously reason that newer housing = "the economic decline can't be that bad," while older housing = "this whole place is ancient and falling apart." I myself MUCH prefer older housing to newer, but I think that for many people worried about or facing economic decline, older housing = more depressing signs/surer signs of fatal local decay + thus flight.

4) And that's the other, or maybe resultant, reason: population decline or stagnation (relative to the nation as a whole, and recent boom areas elsewhere especially). I don't have the stats right here, and I don't have time to find them, but many Western NY regions have seen population declines or stagnation to well match the loss of well-paying manufacturing jobs. By itself, of course, this would depress housing prices.

5) The relatively high taxes in NY state generally. Many people either can't pay those taxes, or are unwilling to if they have the chance to go/live elsewhere. For many people who could pay them, the word "taxes" is automatic poison. They won't stop to think about the good things that can and usually do come from high taxes, in particular high real estate and school taxes. Instead, many people (foolishly) equate low taxes with "automatically better life," and thus recoil from NY state generally. Add to this the fact that NY state *does* have more than its share of corrupt, paralyzed, and inefficient government, and NY state generally, and thus Western NY as part of that, has a real stigma attached to it.

5) The fact that many people don't appreciate what much of Western NY (and much of upstate NY generally) has to offer, and thus either want to flee it or aren't interested in possibly moving there. The nation's newer boom areas--Charlotte, NC; the vast suburbs of Houston; the sprawl around Atlanta; etc.--*seem* to be the place to be, and be happy. Thus the quieter, quainter, and I'm very sure much TRUER merits of living in Western NY don't occur or make sense to them. For me, for all its very real problems--and there's no underplaying the whole country's terrible loss of well-paying, secure manufacturing jobs--Western NY still can be a much better place to live and raise a family than many other supposedly "hotter" parts of the country. It's a battered gem, but a gem nonetheless. But it's a very uncovered, or even forgotten, gem. You almost have to be from the area, or have often visited friends or family who live in the area, to have any real sense of why it's worth living in, even beyond the very affordable housing there.

[BuffaloTransplant]

I grew up downstate on LI. I came here and houses were 2/3 the cost of on LI and at that time the jobs were quite plentiful ( 40 years ago). Realistically, I would say that Buffalonians didn't know what they had in the architectural gems until the late 70s when classy 1800s homes got makeovers; evne early 1900s houses are sometimes gorgeous. Lots of love went into these homes - arch. detail is wonderful. Now, many city homes are as pricy now as the more expensive burbs. You can still get a new build under $200K, depending on the area.
As to why it was always cheaper here, blue collar jobs paid well but not really high... the salary in this end of the state for a working person has never been as high as someone from the area around a major city... say NY -- or any other. Even degrees didn't pull that much extra; I taught 30 years and my salary was about -- at the end -- only 2/3rds of what was paid in NYC or on LI [needless to say, they do a heckof a lot better for pension from the same retiremtn system, but their cost of living is so much higher!]. As to jobs now: I am parent to one kids in late 20s, one who is early 30s :My own 2 kids both make over $50K here and their spouses do as well. One owns a home and the other is looking. This is a good place to start a working career, even if you move on...you just have to hustle and work hard to do it. The jobs are here, you have to spend time looking and have the right skills.
Salaries determine the cost of many things -- like housing.

[bmd69]

Utilities rates are a joke along with high taxes.

[CAugust]

Bottom line is that it is based on what people can afford and demographics. Everyone can say what they like, but thats the bottom line. If all of a sudden the majority of people here made 200k, then the homes would go up, of course that would leave the "better' parts of the city to turn into slums.......but thats how it goes

[Coasters]

The so called affordability is an illusion. Add the real estate tax into the monthly mortgage payment and its equivalent to a price at least $50,000 higher. Real estate agents never bring this up. Add in another couple hundred for heat and utilities and then factor in the fact that you will never build much equity.
Eventually this all comes to the bottom line and the population shrinks. In the upscale suburbs R.E. taxs of $12,000/year are the norm. If you are a professional or an executive ,that house on the lake will cost you $25,000+/year in taxes and you may well lose money on it.
I totally disagree that taxes buy good things for the area residents. The state is in financial collapse and the schools statewide rate very mediocre.
Other states do much better on way less money. New Yorkers are taking a bath, while people in other places can grow their net worth as they pay off their homes.
It is a shame because it is a remarkably nice place to live. The people need to go after the media and the legislature . Google Jay Gallagher and read his articles. I think he is now at an Albany newspaper.
Nothing will happen unless New Yorkers stop talking about how good it is to pay excessive taxes and get real.

[bmd69]

Totally agree. It just makes you mad that the region just forces people hands and makes them look elsewhere.

Living in the Charlotte metro area I can see the evidence of NY State economic policy.

[shibainu]

Originally Posted by zanna vaida

Why do you think properties are very affordable in Western New York?

1 state/local taxes
2. Economy- declining for over 10 years
3. Earn income- average wage is lower and if you are educated NYS is the lowest paid for people that have college degrees
4. Public policies- They hurt the area more than help.

[acegolfer]

Originally Posted by zanna vaida

Why do you think properties are very affordable in Western New York?

Because the Bills haven't been to the playoff since 1999.

Just kidding. Property value consists of two components: land value and building value (or the replacement cost). Usually, the land value appreciates over time because the land gets scarce. On the other hand, the building value decreases because of depreciation. One exception to this is when the construction cost increases which increases the replacement cost.

In most cases, home value appreciates because the land value appreciates faster than the building value depreciates. But the problem of Buffalo is the land value doesn't appreciate as fast because of economic reasons. The population is shrinking and the people in Buffalo proper is moving out of the city. Nice suburbs in WNY have seen increased home values recently.

Of course, there are exceptions to my simple analysis. But 90% of the time, this simple model can explain the home value change.

[homeward bound]

Well, I *did* say that taxes "usually" do fund and foster good things. And I acknowledged all the inefficiency, corruption, etc., problems that plague NY state generally. I agree that citizens need to get outraged and demand more efficiency, more thrift, and more effectiveness from government. Certainly high taxes, in the absence of a growing economy, is a recipe for hastened decline.

But the charge the that NY state's public schools are "mediocre" is misleading, at best.

Where property & school taxes are highest, NY state has some of the nation's top public schools. And in poorer areas, NY state seems to be doing a very good job with the (often considerably) lesser funds such school systems have. Take the poorest counties in NY state and compare them with comparably poor counties in, say, Mississippi or Kentucky, and you'll generally find that the NY state schools are and do better.

Now this very well COULD be because successful people who are able to live in areas with high taxes inculcate good educational habits in their kids, and then expect their kids' schools to do the same. In other words, this high tax/good school correlation could be due more to culture, values, and habits than school funding per se. And I fully agree that one's wanting to learn and being willing to develop the habits necessary to learn ARE more more important than how much money is or isn't being spent on one's education.

However, it also stands to reason that schools that offer higher teacher pay and benefits, and spend more on classroom resources, will *generally* put better teachers in the classroom with better means at their disposal, with a net result of *generally* better teaching.

Also, the SUNY college/university system remains generally excellent, and a great bargain. And this too is in large part the result of the system's state support through taxes.

Finally, as someone who worked in NY state social services for several years, as well as went to NY state public schools and a SUNY university, I can also add that NY state generally does a great job providing social services for the disabled, those in crisis, etc. The programs I worked in were all designed to help people become as independent as possible, too--despite what some may allege about NY state being nothing but a huge welfare machine.

Yes, the state's finances are way out of whack. But good education and effective social services (again, to *minimize* long-term dependency) rarely come cheap.