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I have a bone to pick with the state of real estate and what is now considered "the norm" for housing in this city. I know that New York is a dog-eat-dog city where by virtue of our close proximity to one another we are accutely aware of the haves and have-nots but is it just me or have things become ridiculous here over the past few years? Condos being marketed as "perfect for the first time homebuyer" are over half a million, "great investment opportunity" means a shanty in East NY, and trust-funders are speculating on $1MM homes in areas like Crown Heights. What is left for those of us who love this city and would like to someday own a little slice of it who, despite our tedious efforts at saving, will never think that million dollar homes are "get in at the ground floor" opportunites?
Now I will always accept that there is an "upper crust" which I will most likely never reach. I have no problem accepting the fact that I will never live in a triplex on Fifth Ave overlooking the park. What I find disturbing is the widespread belief that somehow an $800k home is "middle class". I am well aware that salaries in NYC are much higher than the national average and that $100k here is very attainable but what is happening here to the "real" middle class is disconcerting and I wonder what long-term effects this will have on NYC. $1MM in incredibly fringe neighborhoods just does not seem sustainable. The market currently seems to be spiraling out of control with speculation and a mindset of "good neighborhood begets next good neighborhood begets next good neighborhood and so on".
Cheap money isn't out there anymore and I have a suspicioun that some of these $1MM homes are going to quickly turn into white elephants. Even here, where gentrification is running at a fever pitch, those who have $1MM expect amenities (or at the very least safety). Many have paid that price with the expectation that amenities will follow their investments rather than vice versa as it has traditionally been. Now with credit drying up and speculation slowing those amenities may never come.
Those who paid these outandish prices will not be quick to let the prices in these hoods come back down to where common sentiment thinks they should be. They will hold strong in their pricing which in many cases seem to be well over 25% inflated. Those inflated prices can seem justifiable in places like Park Slope where there are not serious quality of life issues but what about $600k vinyl clad homes stacked to the gills with SRO tenants in places like Bushwick?
I think we have some very interesting times ahead of us. Not necessarily for those with the cash waiting on the sidelines to see what happens but for those who are still a few years off, scrimping and saving in the hopes to purchase something modest in the next 5 years (myself included). I know this is purely anecdotal but as someone in their late 20's I cannot help but think how ridiculous the behavior is of those caught up in the frenzy of speculative real estate in the past few years and I know many others like myself who are in the same boat. We are not talking about "gee, I can't wait til the prices in Crown Heights come back down so I can get in there!". No, we are the people who make under 100k and are looking for the next neighborhood.
Remember the way people scoffed at the idea of leaving Manhattan and moving to Brooklyn? How "bridge and tunnel" it was? Brooklyn is to a generation of newcomers what Manhattan was to the "old guard". We are not tied to the need to be 4 stops from Williamsburg or Park Slope hoping everyday that we will get the spillover and table scraps from those areas and turn into the "next whatever" by proxy.
Those of us who make "normal" salaries are not priced out of NY and we are not out spending our money on wardrobes, drinking $11 cocktails, and fancy meals. We are not stretching our admittedly modest (by NY standards) paychecks to their limits to live four deep in the West Village and our parents are not subsidizing us.
Believe me, there are a lot of people like me. Everything from normal working twenty-somethings, to hipsters, to artists, musicians, and everything in between. This generation is waking up to what is out there for us and are realizing this euphoria is coming to an end and we need to start looking for the next "thing" in NY, by which I mean neighborhoods and places where we can carve out a niche without being double-wide stroller wielding, latte sipping, skinny jean wearing, jaded and obnoxious a--holes.
That is why I love this board. You see that the folks here are not pushing their "live below 96th street agenda" and live interesting lives in all parts of this great city from the South Bronx, to long neglected warehouse districts, to well established working-class neighborhoods, and beyond. This city has a lot to offer beyond what you read in the Village Voice and the genuflection of the NY Times real estate writers.
I'm not deluded enough to think that dependence upon Manhattan is something that any of us will ever break free of but there is something else out there beside what is currently there and many of us younger transplants who want to make this city our home for the long haul realize it. The brownstone neighborhoods have already been snapped up by the monied Manhattan expats and even those areas had noses turned up at them not too long ago. When things come back to reality look for us of the "next generation" to turn our back on these areas and become contributing members of communities elsewhere in this city.
I have some ideas of where that may be in this city and can already point out reasons why I think so. I would love to see a little discourse about where this may be and welcome any opinions on my admittedly winded rant. Agree? Disagree? Let me have it!
******* If you read all this I appreciate you taking the time to do so and hope to hear your opinions on the state of the middle class in NY, the "next" neighborhoods, and anything else related. Thanks and sorry for the rant! ********
I think you're right that reading this board will allow you to see that there still is room in this city for people earning under 100K to buy a place to live. It's just a matter of adjusting expectations and hoping that your friends will adjust theirs as well. From reading this board you probably are now familiar with plenty of interesting working-middle-class neighborhoods you might never had heard of before. But if you move to one of those places and all your buddies stay in Brooklyn near Ft. Greene because they can't bear to leave, then it will be alot more work to stay in touch with them.
You might be interested in this thread on Queens Central - it turns into a discussion of why the Times would have its readers believe there's nowhere decent to live in Forest Hills for under 400K, yet many of the people who live in that vicinity have bought perfectly nice places recently for much less (~200's). "The Hunt" Finds Queens « Queens Central Forums
Thanks for the forum link Henna. I've been looking for a good Queens forum as I truly believe Queens is going to become the borough where many of those priced out of Brooklyn are going to be going next. As you pointed out in your "Brooklyn at all costs" thread I think many of the see-and-be-seen hipster set will always have the "I'd never be caught dead in Queens" attitude but I think many of us in our late twenties do not have those prejudices. The "Brooklyn at all costs" idea I think will be one grasped onto by a few just as there are those who could never imagine living outside of Manhattan. In general I think that idea is very antiquated but you still see the Times constantly running pieces about people who have *gasp* uprooted themselves and moved to Brooklyn! Even in a time when Brooklyn has been completely "discovered" you are still seeing the provinical Manhattanites and recent transplants looking at Brooklyn as the only option. They will take dangerous areas like Bushwick and Bed-Stuy over safe middle class enclaves in Queens just because it's Brooklyn. I think this is changing for those with open minds who don't feel the need to run with the skinny jean set.
I think I am very close to this right now as my friends are all in their mid-20s to early-30s, have stable jobs that pay well enough, and would someday like to buy here. This is a hot topic amongst us who are all saving to buy with varying degrees of discipline. We can't understand why people are spending millions to live in areas like Crown Heights when *shhh* a couple miles away is a safe area closer to Manhattan with a great prewar housing stock and safety to boot. It isn't about the name of the location for us but somewhere affordable. No preoccupation about the stigma of living in Queens here.
We all sort of cringe when more articles pop up about places like Jackson Heights and Sunnyside as we are all just hoping to get our savings together before the rest of the crowd gets over the "yuck...Queens" attitude. I'm not talking about a bunch of young pencil pushers begrudgingly moving to Queens because it's all they can afford either. Sure finance plays a HUGE roll in things as it does for any income bracket but people are moving in and quietly finding like minded young people and forming small but close-knit groups. I know a number of artists -- real working artists, not hipsters who paint on the side and live on Dad's dime -- who are moving into Woodside. A number of young professionals moving into Jackson heights and discovering the great ethnic restaurants. And on, and on...
There is a groundswell in the younger generation to which I belong who are disenchanted with the soaring prices of real estate, the dollar envy, and looming financial uncertainty who just want a nice place to live. In many ways maybe this is no different than the desires of generations past who have settled in place like Queens, Bay Ridge, Riverdale, etc. Just a bunch of folks looking for the best they can get for their money. But in a way I also think it is more than that. Almost a backlash of the "gentrify Brooklyn!, party hard!, squat in a warehouse in a crappy neighboorhood!, be fabulous!" type of ethos that has driven the gentrification wave of the last decade. Or maybe I'm just getting old.
It's hard to tell and it will certainly be a slow process but I'm just saying that I don't think the gentrification of fringe Brooklyn areas is going to continue forever. When you look at what you can get for $1200 and your options are a studio in Bushwick or a studio in a nice pewar building in Queens or Bay Ridge that is safe and has everything you need for day-to-day already in place...well...the choice seems obvious to me.
Simply put -- this real estate phenomenon is pure speculation.
Everyone knows someone who bought property 15-20 years ago in some crack-infested s***hole of neighborhood and is sitting on a million in equity today. Others are inevitably going to try to hit the same jackpot, and Tulip Mania begins.
All markets are eventually rational, and households making $200K+ per year, required income for a $1MM mortgage, are a finite commodity, even in NYC. What will further correct the market is the fact that so much new stock is being built.
Another point: I sincerely believe that many real estate purchasing decisions are made in this city not based on any realistic judgment of value, but rather, on which neighborhoods are being talked up at the cocktail parties, gallery receptions, and the Times real estate pages. This is how Harlem and Bed-Stuy got "cool". There are many decent, safe, and lower-priced nabes all over at least four of the five boroughs, plus the some of the burbs. All offer offer a good quality of life for a lot less money. However, the type of person who just impressed his friends with the "steal" he got on his Bed-Stuy condo wouldn't be caught dead in a place like Sheepshead Bay or Glendale, even though he'd have more space, better safety, and a few more bucks in his pocket for cocktails in the City.
I am greatly amused reading The Hunt in the NYT every weekend and getting a chuckle of out some of these people like Henna is referring to in her post.
Rest easier in the fact that these are people who have more money than brains, and, as the old saying goes, "a fool and his money are soon parted". Smart investors look for value - that means good "fundamentals" and a solid long-term outlook.
Thanks for the forum link Henna. I've been looking for a good Queens forum as I truly believe Queens is going to become the borough where many of those priced out of Brooklyn are going to be going next. As you pointed out in your "Brooklyn at all costs" thread I think many of the see-and-be-seen hipster set will always have the "I'd never be caught dead in Queens" attitude but I think many of us in our late twenties do not have those prejudices. The "Brooklyn at all costs" idea I think will be one grasped onto by a few just as there are those who could never imagine living outside of Manhattan. In general I think that idea is very antiquated but you still see the Times constantly running pieces about people who have *gasp* uprooted themselves and moved to Brooklyn! Even in a time when Brooklyn has been completely "discovered" you are still seeing the provinical Manhattanites and recent transplants looking at Brooklyn as the only option. They will take dangerous areas like Bushwick and Bed-Stuy over safe middle class enclaves in Queens just because it's Brooklyn. I think this is changing for those with open minds who don't feel the need to run with the skinny jean set.
I think I am very close to this right now as my friends are all in their mid-20s to early-30s, have stable jobs that pay well enough, and would someday like to buy here. This is a hot topic amongst us who are all saving to buy with varying degrees of discipline. We can't understand why people are spending millions to live in areas like Crown Heights when *shhh* a couple miles away is a safe area closer to Manhattan with a great prewar housing stock and safety to boot. It isn't about the name of the location for us but somewhere affordable. No preoccupation about the stigma of living in Queens here.
We all sort of cringe when more articles pop up about places like Jackson Heights and Sunnyside as we are all just hoping to get our savings together before the rest of the crowd gets over the "yuck...Queens" attitude. I'm not talking about a bunch of young pencil pushers begrudgingly moving to Queens because it's all they can afford either. Sure finance plays a HUGE roll in things as it does for any income bracket but people are moving in and quietly finding like minded young people and forming small but close-knit groups. I know a number of artists -- real working artists, not hipsters who paint on the side and live on Dad's dime -- who are moving into Woodside. A number of young professionals moving into Jackson heights and discovering the great ethnic restaurants. And on, and on...
There is a groundswell in the younger generation to which I belong who are disenchanted with the soaring prices of real estate, the dollar envy, and looming financial uncertainty who just want a nice place to live. In many ways maybe this is no different than the desires of generations past who have settled in place like Queens, Bay Ridge, Riverdale, etc. Just a bunch of folks looking for the best they can get for their money. But in a way I also think it is more than that. Almost a backlash of the "gentrify Brooklyn!, party hard!, squat in a warehouse in a crappy neighboorhood!, be fabulous!" type of ethos that has driven the gentrification wave of the last decade. Or maybe I'm just getting old.
It's hard to tell and it will certainly be a slow process but I'm just saying that I don't think the gentrification of fringe Brooklyn areas is going to continue forever. When you look at what you can get for $1200 and your options are a studio in Bushwick or a studio in a nice pewar building in Queens or Bay Ridge that is safe and has everything you need for day-to-day already in place...well...the choice seems obvious to me.
I don't want Queens & the Bronx to turn into downtown & Brooklyn. Stay out.
I don't want Queens & the Bronx to turn into downtown & Brooklyn. Stay out.
Haha. I love this mindset. Listen my friend, everyone wants the same thing as you: a decent place to live that they can afford. This means different things to different people. I just don't understand the resistance to new residents, especially in places like New York City which are built on change. Yes, I understand how annoying a bunch of trust-funders running up your rent can be but that is not what I'm talking about here. Those people will hold onto Williamsburg with their dying breath. I am talking about normal, working people who are not buying into the "Bushwick is AWESOME!!!" mindset and just want a nice place to live. Wanting to keep newcomers out of "your" area is small minded. Get over it.
I think you are dead on. I think the real estate market of the last 6 or 7 years has been based on speculation and looking at the home not as a plce to live but as an investment. I think with the tightening of mortgage market potential homebuyers will not be playing so fast and loose with their money. Home purchasing decisions will come back to what they have always been -- a place to live -- and I think people will start really reconsidering what is important when buying a home and not what could potentially give them the biggest short term financial gains. Neighborhoods, schools, safety, comunities, and amenities will come back to the forefront while recent buyers in fringe neighborhoods may be sitting on a severly devalued asset and nowhere to go with it. I picture the white, upper class Manhattan expat who just paid $1.2 for their Bed-Stuy brownstone holed up in their home, afraid to go out, wondering where all of their promised gentrification went. It's a sad picture but this bubble has birthed some very irresponsible homebuyers.
I picture the white, upper class Manhattan expat who just paid $1.2 for their Bed-Stuy brownstone holed up in their home, afraid to go out, wondering where all of their promised gentrification went. It's a sad picture but this bubble has birthed some very irresponsible homebuyers.
The harbinger of failed gentrification: Red Hook. Aside from that admittedly cool converted warehouse on the waterfront with the Fairway market, nothing else caught on. Now that the Water Taxi has suspended service there, things will get worse.
Housing in the city, all over the city, as increased....no doubt about that. The main issue is not affordability, I think it is more that people are demanding the same neighborhoods and that drives up the prices. If everyone wants to live in the East Village..guess what happens? There are PLENTY of places across the city that are still quite moderately priced, but people want their cake and eat it too...as a result...those same few neighboohoods are exorbitantly prices, while others are quite cheap.
I see plenty of affordable places to live...but nobody entertains those options because they are not perceived as "livable" "safe" "cool", etc. Until that mentaility changes and people who want to remain in the city consider areas that are outside of the few hot spots, the prices will continue to escalate and housing will be unattainable for most.
Off the top of my head I know a new luxury condo development (granite countertops, ss appliances, etc) with 2 bedrooms for $200,000...that is quite affordable. I know 2 family homes with parking, backyard, and well maintained for $400,000...all within a few blocks of trains to the city and a short commute....single families for $300,000 and under..and so on...why are these not mentioned? From where I stand the city is quite affordable....open your eyes, get over the "hottest" neighborhoods, and see how affordable the city STILL is.
If anyone would like info on these....feel free to email me! I am no broker, I just know my neighborhood.
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