Slightly fewer than one-third of New Yorkers live in homes they own, including co-ops and condos, which is half the national average and less than virtually every other large American city.
Affordable housing, according to a new report in The New York Times, has become even harder to find as prices and interest rates have risen while listings have declined. Between the second quarter of 2019 and 2022, as the typical home price rose to nearly four times the median family income nationally, the price of a home in New York City has remained more than nine times that level, according to the Federal Reserve Bank of New York.
The situation is reinforcing worries about the city’s long-term health: As home owning becomes even more out of reach, racial and wealth disparities could be exacerbated and more middle- and working-class families could be driven out of the city. If the trend continues and the city becomes a gilded isle, the mantra will become "Get rich or get out."
“It’s one of those hard, difficult problems that we have to tackle, or else we’re going to end up with a city that’s only affordable to the very, very wealthy,” says Christie Peale, the chief executive of the Center for New York City Neighborhoods, a nonprofit group that pushes for affordable homeownership.
A vicious cycle has set in. Nearly everything is more costly now, in large part because of the city’s housing shortage. But the economic and social fluctuations during the pandemic have made the situation worse.
“You had a huge run-up in home prices, compounded with a huge run-up in interest rates,” says Laurie Goodman, founder of the Housing Finance Policy Center at the Urban Institute, a nonprofit research organization. “The result was a huge increase in un-affordability.”
The income required to afford a home in the middle-third of the New York City area market in September 2019 was about $117,450, assuming a 30-year fixed rate mortgage, according to an analysis by the Harvard Joint Center for Housing Studies. That jumped more than 59% to almost $187,000 in September 2022.
Mayor Eric Adams has made boosting “affordable homeownership” — and trying to bridge the racial wealth disparities — a key piece of his housing agenda. Closing the wealth gap is going to be tough, but closing the racial gap is going to be an especially steep climb. Why? Because the homeownership rate for Black residents is roughly 27%, and for Hispanic and Latino residents it's roughly 17% — well below the 42% rate for white New Yorkers.
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