By Sabina Mollot
New Yorkers looking to grow their families should take note: Two-bedroom apartments located in over half of the zip codes in this city are unaffordable based on what those areas’ current residents earn.
RentHop, an apartment listings website that often conducts studies on neighborhood trends (from dog poop offenses to where there are the most rat sightings) has concluded the lack of affordability based on current asking rents in each zip code.
The study, released in July, notes that affordability is based on whether a household earns 40 times the amount of what a month’s rent costs in their annual incomes, which would mean about 30 percent of the household’s income goes toward rent. Some landlords require tenants to earn this much before leasing to them.
Using this formula, of 52 percent of the zip codes looked into, median rents for two-bedroom apartments were not only unaffordable, but they exceeded half the household income, effectively rent-burdening the occupants.
The city’s average rent as of June for a two-bedroom was around $3,650, and this would require a $146,000 income to meet the 40X threshold. However, this is almost 2.5 times the median household income in the city, which is $58,856, based on the most recent census data.
Out of all the zip codes, Tribeca’s (10007) was the priciest, with asking rents of $5,498 for a two-bedroom. However, the household income average is also high at $236,560, making the rent a mere 28.1 percent of the income.
In Stuyvesant Town’s zip code (10009), also Alphabet City’s, the average asking rent is $3,610, so to comfortably afford this, a household would need to earn $144,400. Meanwhile, the actual median household income is just $60,788, which would mean paying 42.4 percent on rent.
In 10010, home to Peter Cooper Village, Flatiron, the north end of Gramercy and east tip of Kips Bay, the average two-bedroom is $3,890, making the income necessary to afford an apartment $155,600. The median household is actually $110,142, which would mean paying 71.3 percent on rent.
In the East Village and much of Gramercy (10003), the average two-bedroom is $3,900, affordable for those who earn $156,000. The median household income in the area, however, is $100,791, which would mean paying 46.4 percent on rent.
In Murray Hill (11345), asking rents are much lower at $2,300 for a two-bedroom, affordable for those who earn $92,000. However, the actual median income isn’t even half that amount at $43,660, which would mean paying 63.2 percent on rent.
The study does note, however, that the numbers are asking rents, not the average of what everyone is necessarily currently paying, so it’s possible plenty of people’s costs of living are affordable due to ownership, rent regulation or a competitive market rate rent.