Dream City: Why Are Wall Street Financiers Fleeing New York?

2024 Author: Seth Attwood | [email protected]. Last modified: 2023-12-16 15:55

New York is ranked 4th in the ranking of the most expensive cities in the world after Hong Kong, Singapore and Osaka. More than a hundred billionaires live in the metropolis, but sometimes even for them the city seems expensive. At the same time, 60 thousand homeless people spend the night on the streets of New York every day. Here you can buy a slice of pizza for $ 1, paying at least $ 3,000 a month for housing.

For comparison, the cost of living in Manhattan is 148% higher than the average in other US metropolitan areas (according to statistics for 2019). How Good Is The American Dream And Why Are Even Wall Street Bankers Running From Here?

1. Better to spend millions on a basement than living in a small apartment

New York is developing rapidly, and therefore housing prices are growing exponentially. Every year, the value of real estate breaks new records, despite the fact that more than one and a half million people (the population of New York - 8 million) live in poverty.

Realtors try to use every free centimeter and sell it profitably. For example, a New Yorker bought a duplex in a basement of 195 square meters near Central Park. with two bedrooms for $ 2.3 million. However, the property is one floor higher, but less square, would have cost a million more. By the way, houses in Manhattan cost about $ 1.5 million - five times more than the average cost in the regions (about $ 289 thousand, according to real estate company Zillow).

2. The city holds the record for the number of billionaires

In 2019, Wealth-X conducted a billionaire census. According to statistics, more than 105 people with billions of dollars have chosen New York as the most comfortable place to live. It turns out that there are more rich people living in one metropolis than in almost all countries of the world. The only exceptions are the States, Germany and China.

3. Renting a home in New York is several times more expensive than in other states

Americans prefer to live in two-room apartments. In a metropolis, you will have to pay about $ 3,500 for such a pleasure. But in other cities of the United States, a two-room apartment of the same size can be rented 2.5 times cheaper - for about $ 1,480. The most expensive apartments are in Battery Park City, Manhattan, at about $ 5,530.

According to the portal Markets Insider, renting an apartment in New York is equal to 82% of the average income in the country. By the way, penthouses in a metropolis cost such cosmic money that they are not always sold. Realtors deliberately divide properties into smaller areas to make the price more affordable. Also in New York is the most expensive penthouse in the States. Billionaire investor Kenneth Griffin bought it for a record $ 238 million in the country.

4. Parking takes more money than renting an apartment in smaller cities

Driving and parking in a millionaire is also expensive. For example, according to Parkopedia, New Yorkers spend over $ 600 a month on long-term parking. At the same time, renting real estate in cities like California's San Joaquin with a population of 700 thousand or Colorado Monte Vista, where 4500 people lives, costs the same.

5. For a comfortable life, you need to earn about 100 thousand a year

Financial resource GOBankingRates conducted research to determine what income should be in New York for a comfortable life. It turned out that a typical worker with a salary of $ 21.63 an hour needs to work about 76 hours a week. The company took into account the average income of New York households, hourly wages and estimated annual living costs. As a result, it turned out that the city will need at least 85 thousand dollars a year for comfortable living. 50% is allocated for renting an apartment and other necessary expenses, 30% for less important expenses, 20% for savings.

The Peterson Institute for World Economics has calculated that one New Yorker spends about $ 50 thousand a year on housing, utilities, transportation, medicine, food, taxes. At the same time, in other states, people can only dream of earning so much in 12 months.

And for a family of four, the amount of annual expenses exceeds 120 thousand. Homeowners in a metropolis need to earn even more - about 150 thousand a year. It will take the average American about 3 years to get that kind of income.

6. Schools and kindergartens are more expensive than Ivy League universities

The cost of education in Manhattan is another sore spot. For example, Horace Mann's private preparatory school with kindergarten costs $ 50,000.

For comparison: in the leading universities in the country, Cornell, Harvard and Princeton universities, the annual fee is less. Celebrities, entrepreneurs and investment bankers prefer Avenues: The World School (Kindergarten to Grade 12). The institution costs 54 thousand dollars a year.

7. Wall Street financiers are looking for real estate in cheaper cities

Even wealthy New Yorkers do not want to spend extra money on renting an apartment in a metropolis. Wall Street wolves are moving to neighboring states, according to the New York Post. Also, rich young people do not want to stay in the metropolis. According to research by SmartAsset, New York is the number one city that wealthy millennials want to leave as soon as possible. The main reason is the unjustified high cost of real estate.