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I heard middle class in NYC and LA is about 70-80k a year but 70-80 k in the Midwest and South is a really good salary you can buy a nice home on that salary it depends on where you live but I generally agree with the overall sentiment by the OP thats what Bernie Sanders has been saying for years.
70-80k is tough for a middle class lifestyle in nyc .
as the ny times said in their study :
There is no single, formal definition of class status in this country.
Statisticians and demographers all use slightly different methods to divvy up the great American whole into quintiles and median ranges. Complicating things, most people like to think of themselves as middle class. It feels good, after all, and more egalitarian than proclaiming yourself to be rich or poor. A $70,000 annual income is middle class for a family of four, according to the median response in a recent Pew Research Center survey, and yet people at a wide range of income levels, including those making less than $30,000 and more than $100,000 a year, said they, too, belonged to the middle.
By one measure, in cities like Houston or Phoenix — places considered by statisticians to be more typical of average United States incomes than New York — a solidly middle-class life can be had for wages that fall between $33,000 and $100,000 a year.
By the same formula — measuring by who sits in the middle of the income spectrum — Manhattan’s middle class exists somewhere between $45,000 and $134,000.
But if you are defining middle class by lifestyle, to accommodate the cost of living in Manhattan, that salary would have to fall between $80,000 and $235,000. This means someone making $70,000 a year in other parts of the country would need to make $166,000 in Manhattan to enjoy the same purchasing power.
Using the rule of thumb that buyers should expect to spend two and a half times their annual salary on a home purchase, the properties in Manhattan that could be said to be middle class would run between $200,000 and $588,000.
On the low end, the pickings are slim. The least expensive properties are mostly uptown, in neighborhoods like Yorkville, Washington Heights and Inwood. The most pleasing options in this range, however, are one-bedroom apartments not designed for children or families.
It is not surprising, then, that a family of four with an annual income of $68,700 or less qualifies to apply for the New York City Housing Authority’s public housing.
i grew up in a nyc housing project because my family had very little income .
Last edited by mathjak107; 12-11-2015 at 07:35 AM..
70-80k is tough for a middle class lifestyle in nyc .
as the ny times said in their study :
There is no single, formal definition of class status in this country.
Statisticians and demographers all use slightly different methods to divvy up the great American whole
into quintiles and median ranges. Complicating things, most people like to think of themselves as middle
class. It feels good, after all, and more egalitarian than proclaiming yourself to be rich or poor. A $70,000
annual income is middle class for a family of four, according to the median response in a recent Pew
Research Center survey, and yet people at a wide range of income levels, including those making less than $30,000 and more than $100,000 a year, said they, too, belonged to the middle.
By one measure, in cities like Houston or Phoenix — places considered by statisticians to be more typical of average United States incomes than New York — a solidly middle-class life can be had for wages that fall between $33,000 and $100,000 a year.
By the same formula — measuring by who sits in the middle of the income spectrum — Manhattan’s middle class exists somewhere between $45,000 and $134,000.
But if you are defining middle class by lifestyle, to accommodate the cost of living in Manhattan, that salary would have to fall between $80,000 and $235,000. This means someone making $70,000 a year in other parts of the country would need to make $166,000 in Manhattan to enjoy the same purchasing power.
Using the rule of thumb that buyers should expect to spend two and a half times their annual salary on a home purchase, the properties in Manhattan that could be said to be middle class would run between $200,000 and $588,000.
On the low end, the pickings are slim. The least expensive properties are mostly uptown, in neighborhoods like Yorkville, Washington Heights and Inwood. The most pleasing options in this range, however, are one-bedroom apartments not designed for children or families.
It is not surprising, then, that a family of four with an annual income of $68,700 or less qualifies to apply for the New York City Housing Authority’s public housing.
Thats part of the problem and reason why Atlanta and Nashville have so many Chicago and NY transplants, the cost of living here is cheap. Income inequality in America is getting out of control.
the biggest benefit of living in these very high cost areas is real estate values when you sell .
you pay a fortune to buy and taxes are insane .
but 30 years down the road when you want to sell and relocate you are usually very well to do relocating to cheapsville . you get a low cost house and have lots of cash . unlike the locals in these areas who only end up with the low cost house and not much more since they can't relocate and get a windfall without moving some place horrible .
400,000 baby boomers and millennial in a recent study in long island said that is their plan .
while those living all their lives in these low cost areas think those of us in high cot areas are nuts , the fact is at the end of the day we potentially come out a whole lot better if we just relocate and those years of high cost living pays off ..
i can tell you it would be no contest if i owned the same investment property's that we sold on central park south if it was in atlanta instead . we could take that money and live like kings in Atlanta .
Last edited by mathjak107; 12-11-2015 at 07:31 AM..
the biggest benefit of living in these very high cost areas is real estate values when you sell .
you pay a fortune to buy and taxes are insane .
but 30 years down the road when you want to sell and relocate you are usually very well to do in cheapsville . you get a low cost house and have lots of cash . unlike the locals in these areas who only end up with the low cost hose and not much more since they can't relocate and get a windfall without moving some place horrible .
400,000 baby boomers and millennial in a recent study in long island said that is their plan
Nobody wants to live in the same place for that long. I grew up in a military family and I have lived in three countries and 7 US states, its boring to live in the same house for 30 years, I would not do it for a billion dollars. I do not care about real estate.
it does not have to be the same house . most folks move at least once every 7- 10 years . but they tend to stay in the same region until retirement and they roll one house in to the next .
the biggest benefit of living in these very high cost areas is real estate values when you sell .
you pay a fortune to buy and taxes are insane .
but 30 years down the road when you want to sell and relocate you are usually very well to do in cheapsville . you get a low cost house and have lots of cash . unlike the locals in these areas who only end up with the low cost hose and not much more since they can't relocate and get a windfall without moving some place horrible .
400,000 baby boomers and millennial in a recent study in long island said that is their plan .
while those living all their lives in these low cost areas think those of us in high cot areas are nuts , the fact is at the end of the day we potentially come out a whole lot better if we just relocate and those years of high cost living pays off ..
i can tell you it would be no contest if i owned the same investment property's that we sold in atlanta vs central park south . we could take that money and live like kings in Atlanta .
If 400k people are planning to do this what impact will that have on the value of their land/homes?
In most cases one is better off investing the difference in the market rather than buying an expensive property and hoping for appreciation as their retirement strategy.
Research shows that the real return on property is ~ 1%/yr over time. Obviously there are certain areas where you could strike it rich because you bought at the beginning of a hot market (similarly if you happened to buy UA in 2006 you would have done the same thing), but when you look across the country over very long periods of time the real return is roughly 1%/yr. There are many things people forget to factor in. Upgrades to the house over time, basic maintenance, etc. (If you had instead put that money in the market what would it be worth?).
I had a friend that was talking about his grandmother's house in NYC area. She had bought it for 65k in 1967 and sold it for 675k in 2014. When you factor in basic inflation the house would be worth a little over 460k, which means she made about 215k on the house. That's a good profit, but does she still have the same flooring? Same kitchen? Same bathrooms? Same cabinets? If not, how much did she pay to replace those? How many times did she replace them? When did she do the replacements? Factor in the inflation for all of the updates and upkeep too and the gains you made really start to dwindle away.
no one knows the effects . but long islanders have been relocating for decades with no ill effects so far.
i have been an equity market investor since 1987 and have done very well . but compared to our ventures in nyc real estate it wasn't even close . i hit my first million at age 50 around 2000 . investing in nyc real state we tripled it in 15 years after taxes . .
to make big money in real estate is a professional game . just buying a property and collecting rents wasn't what i wanted to do . there are all kinds of deals the pro's are privy to .
our thing was buying up rent stabilized co-op apartments by central park and offering tenants 100k to sell us their lease back so we could sell for 7 figures .
we also bought commercial lease rights on property's we don't own , then sold the rights .
Last edited by mathjak107; 12-11-2015 at 08:01 AM..
no one knows the effects . but long islanders have been relocating for decades with no ill effects so far.
i have been an equity market investor since 1987 and have done very well . but compared to our ventures in nyc real estate it wasn't even close . i hit my first million at age 50 around 2000 . investing in nyc real state we tripled it in 15 years after taxes . .
to make big money in real estate is a professional game . just buying a property and collecting rents wasn't what i wanted to do .
I didn't say it wasn't possible. I find it odd that you of all people don't understand how it's akin to investing in a single stock. If I had put 20k in Under Armour in 2006 it would be worth over $175k today.
Sure you can make it huge, but you could also lose a ton. Look at all the people in Florida that bought homes on ARMs in 2004 thinking they'd live in them until the ARM came do and sell it and move up in house. I rented a house in Orlando that was on the market in 2007 (before the real estate bubble burst) for $525k. I found it for sale in 2011 before I left for $250k.
Also, I don't find being a millionaire in net worth by 50 all that impressive, especially when it took you tripling your property in 15 years to get there. If my home tripled in 15 years I'd be there by 36. You've done a great job with your investments you are gonna have a very comfortable retirement, but again, my main point was that on average homes are not a good investment and all of the data shows this. Similarly, on average people who pick single stocks under-perform the market.
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