Manhattan Apartment Prices Surge with Qualifying Salaries Above $150,000
Rent prices in Manhattan continue to skyrocket, more than making up ground lost during the early days of the COVID-19 pandemic. But just how much you have to make to qualify for an apartment might shock you.
As Quartz notes, real estate brokerage Douglas Elliman found that the average one-bedroom apartment price in Manhattan is just shy of $4,000 a month now. In New York City, a common requirement is to make 40x the rent in annual salary. Applied to this price, a renter would need to make nearly $160,000 per year to qualify for a new apartment. In Brooklyn, where the average cost is $2,900, that would mean an annual salary of $116,000. NYC’s median household income is just over $67,000 annually.
Even if you find one of the city’s precious rent-stabilized apartments, you might need to pay an exorbitant fee. A recent Hell Gate article found a rent-stabilized, two-bedroom unit on the Upper East side. Initially listed for $3,150 a month, it turned out the stabilized unit cost just $2,250 per month with legal limits on future increases but came with a whopping $10,000 broker feel. This fee brought the amortized rent to the listed price. Would-be renters would have to pay a considerable premium to access an apartment meant to shield residents from out-of-control housing costs.
No law in New York state stipulates precisely how much brokers are allowed to charge for their services, and NYC is one of the few places in the country where these fees are common. Regulators attempted to rein in the practice in 2020, but the state’s court system later upheld it.
As Slate notes, a combination of factors may have come together to push rents so high. These include the rise of remote work, the expiration of COVID-19-era deals, the strengthening of rent stabilization laws in 2019, the popularity of Airbnb, and changes in household formation patterns brought on by the pandemic. Together, they’re squeezing the budgets of NYC’s lower-income residents, who are finding less and less leverage as they attempt to negotiate their cost of living.