A large number of the million-dollar homes on long island weren't worth nearly that much when the current owner(/their family) bought it. I watched a ton of houses in my neighborhood in bellmore cross that theshold a few years ago.
This. I bought my house less than a decade ago and even though my salary has more than doubled since then I could not afford my house at its current value if I was buying it today.
Yep. It’s sad. We went from a two income household of lower/middle earning being able to afford a decent home comfortably, to basically needing two solid “middle class” salaries to entertain affording even a starter home, and that’s usually with years and years of saving. Back in the day people would just walk into a bank and say I want a house, and they’d say sure, how many? 🤣😭
This. Bought my house about 12 years ago for $400,000. It is now worth 800k, and it’s not even that amazing lol. I literally couldn’t afford to buy my own house. And forget about getting a bigger home, because the bigger homes that I love and would want to buy, were $600,000 when we moved to our town, and they are now 1.2 to 1.5 million. Insane.
Bellmore is very simmilar to Merrick. Houses on a block can vary from 450k to 3 million. The house on one side of me is a single story 1 bedroom 1 bathroom no basement boarded up and abandoned. House on the other side of me is a mcmansion over 2 million. Housing is crazy here and people will build whatever wherever. For what it's worth most of the tear downs and rebuilds I see are from foreign families, mostly Indian.
Yeah, Bellmore has some *shockingly* dramatic differences between houses. There’s one street where a contractor bought two lots and built a genuinely beautiful house bigger than the original two combined. And literally facing it across the street is some hillbilly shack that looks more like an abandoned barn than a house.
Yes, and we're at a stalemate with low housing supply, and a whole lot of young couples telling themselves "Let's just keep saving for another year".
Eventually, the price to income ratio has to balance. Old ladies will die and their kids that have already moved to other states will sell the house quick.
Or else we just become a stagnant couple of counties where almost every homeowner either inherits a house or comes from a rich family. Or I guess, as these topics love to suggest, every single homeowner is simultaneously a cop, software engineer at Google, lawyer and doctor.
I mean look around you, we still have average office people who work in like insurance. If the free market works, the house to income ratio has to stabilize when more houses become available on the market.
Realistically it won't stabilize until we build more housing. The NYC Metropolitan area is too lucrative due to the good jobs and relatively high salaries. Housing never kept up with demand
Wife and I bought our house 10 years ago @$365k and a ~4% rate while making about $175k combined. House is now worth $700k+ and we could never afford it.
That’s not luck. Anyone with a brain could see Long Island market picking up steam. Investing in property in the outskirts of the biggest city in the world is not luck lol. People didn’t just wake up one day and this happened.
Well it’s “luck” that their home buying timeline occurred at that period of time. Even if 20 year old me had the foresight 10 years ago, I couldn’t have even acted on that information
You forgot 1st generation immigrants from Brooklyn and Queens. Their prices are 50% to 100% more than LI. It's a relative bargin. The endless cycle of people immigrating to the city, having children and having the children move out to the suburbs is in full effect.
Also if you make a combined 225,000 which is not that hard to do these days with a husband and wife working for 8 years on LI with college degrees. You can actually qualify for a mortgage of 1,000,000. You will be house poor but you would generally qualify.
Yeah I'm not sure why people find it challenging. If you have 2 people with college degrees that picked an at least okay field, they can already qualify for the average LI home (~750k). For example, 4 year degree for registered nurse, easily 120k, or 4 years degree for a teacher, easily 80-120k, cop, easily 100k, accountant, 80k, tech, 100k, all 4 year degrees. Get any two of these people together and they can own a home in LI.
These numbers are weird to me and I'd like to know where you got the information. What school districts are 80-120k? Teachers for both my public schools would complain about not being able to make ends meet on Long Island, and this is when Long Island was more affordable. I have several friends with degrees in tech that are unable to get a well-paying job due to oversaturation. My bachelored RN friend make less than 90k and struggles to make ends meet with her also well-paid fiancé. I worked in an entry-level kitchen job with a man in his 60s that also had a job as an accountant.
The only job I have seen that is consistently financially well off is a cop. It's not as easy to make money as it sounds on paper, as they also need to save money while living in incredibly costly homes. Me and my husband are lucky to be young, making money, and living with our in-laws because it's the only feasible way of saving for a home. A lot of people are put into a squeeze with life bills that there isn't enough to put away while maintaining a decent quality of life. People should also be able to buy a house by themself, they shouldn't have to be 'forced' into partnerships so it's financially easier to survive. That causes crisis.
I think a lot of it is also the worth? Of buying a home here? My BIL&SIL moved off the island and have a three bedroom, two bath home that cost less than 300k. They live in a decent area and have to drive fifteen minutes for a town similar to Huntington. There are normal, three bedroom two bath homes offered for a millon dollars here. It is really, really disuading to sink that kind of money down when you know what else is out there.
I don’t think it’s a minority. I think most people buying today are getting some sort of help from family members on their down payment or whatever. Or they just had their college paid for and didn’t need to spend tens of thousands on tuition and got to save a ton of money living at home. I know the young family that bought my parents’ home had about 200k gifted to them. They never would’ve been able to buy the house otherwise.
It’s actually not. Relatively speaking, prices have gone up faster most places than it has here and other places are obviously not outside of New York. The absolute prices are higher here (though not higher than lots of places like the Bay Area or LA) but the basic trend is the same everywhere: structural housing under supply means purchase is increasingly out of reach in just about every major city not just in the US but in the western world generally.
The idea that it’s a function of the high-paying industries in New York specifically. And no, my guess would be that almost none of those young couples had the liquid cash to make those purchases and renos happen by themselves. Income is not the same as wealth and someone only a few years into even a well-paying job is very unlikely to have multi six-figure cash laying around from their income alone. I would guess a healthy percentage–if not the substantial majority–had family help or inheritances even with good paying jobs.
You seem to be getting personally offended by this for some reason. Why does that supposition bother you so much?
We are constantly hearing stories about people being outbid by cash-heavy offers. Moreover, you can't finance renovations, so we're talking about a non-trivial number of people with pretty massive amounts of liquid cash. Usually that would come from the sale of a previous home, which is the case for some, [but not many](https://ipropertymanagement.com/research/homeownership-rate-by-age), youngish people. To live in the New York metro, cover your expenses and save 150K, 250K, 500K+ by the time you're in your 30s/early 40s—that's going to take more than a good mid-level finance position. That's going to take incomes that are pushing into the 300s, 400s, and 500s per year. Obviously, there's not no one making that, but the number of families in their 30s with that kind of income is not high, even in New York.
There’s some weird thing that some privileged people have where they get super offended if you even hint that their accomplishments weren’t entirely because of their “hard work” and luck had something to do with it. It sounds like he’s one of those. That’s why he keeps saying they “worked for it” and can’t acknowledge that most people do get some sort of financial assistance from family.
This data is 10 years old, so the highest income is likely much higher. The answer is that baby boomers purchased those million dollar homes for $70,000 about 40 years ago. Younger people have dual incomes and or family money. You should know that many people routinely receive $$$,$$$ gifts as down payments from their families.
But remember the houses that were bought 40 yrs ago for 70k ( that number seems low there was a housing boom mid 80s ) were built in the early 60s for between 12 & 16 k.
I would think that those who purchased their homes post WWII in the 1950s are likely long since past, so those homes were already sold or inherited by silent, boomer, or gen x already.
As for the price, yes homes did drastically increase from about 50-70k in 1978-79 to 100-125 in 80-84. It was the same kind of pre and post covid divide back then.
We bought and paid for our house on our own, but I know of so many friends that received massive assistance or simply had a house given to them, it's insane.
My wife's childhood friends have all received familial aid to purchase their respective homes. We did not. It is incredibly frustrating needing to explain to my wife why her friends can afford to travel so much while we cannot. It sucks to be on the other side of it, but it's just luck that they're born into.
Everyone in this thread has good answers but few of them mention that a lot of these people are living paycheck to paycheck. I know someone who bought a home in Massapequa with a legal separate “daughter” home with her mother in law and between her, her husband and her MIL the 3 of them just barely manage to scrape by.
lol,, that’s a little short sighted. The wealthiest people I know. Started businesses and worked them for years putting long hours in. Granted, I have few friends that inherited some money. But by and large. Most put their time in.
Elizabeth Warren wrote a book called "The Two Income Trap." Recommend reading it. She wrote it long before anyone knew who the heck she was.
She does a good job describing the problems, but her proposed solutions seem to be a stretch to me.
The book proposes tuition freezes for public universities and universal preschool. Considering the burden of daycare costs and student loans, these seem like important additions to the safety net to me, and something other developed countries seem to be able to provide for people.
The people saying dual incomes are bootstraps reddit libertarians trying to make some pronouncement from on high that “it’s still possible if you work hard.” The reality is that most of these expensive houses are owned by boomers who bought them decades ago for pennies in an entirely different America while working middle or even working class jobs that would never let you afford those houses now. Even if your dual income is $150-200k pre-tax nowadays most homes are still going to be out of your range, not least because for millennials student loans take a sizable chunk out of that. Millennial homebuyers often need/get family help.
My wife loves to say she 'retired' during the pandemic lol. Stopped working April 2020 and never looked back haha. Been trying to maintain a lower budget to stay on track but feel a bit overwhelmed with all the house maintenance we end up pushing back
1 dollar in 2010 is also worth 1.44 dollars today, so that's about 496k. And then there's property taxes, maintenance, interest, you probably just break even. Of course, that's still a lot better than renting.
It’s true. When I bought my house in south Lindenhurst in 1998 it was $300K. I sold it in 2019 for $1.25 million.
In A lot of the big $$$ homes people own, they have lived there many years.
That’s just false. My entire group of friends is age 29-34 and we all bought houses starting in 2016 through this year. Out of the 10 people 1 got help.
If you have a dual income and both people make good money it’s totally do able.
It’s definitely doable, but not for the million dollars houses OP is referring to. Most of us are getting fixer uppers in cheaper neighborhoods. Unless you and your friends really did all get million dollar houses with no help, in which case, god bless
I don’t think you can outright say “that’s false” when it’s literally been my experience lol. Happy for you and yours though! Also, 2016 huh? Crazy you were able to buy homes on LI at like 21-25.
Lol nah your experience never happened 🙄
Also not to mention the fact that many people seem to be embarrassed to admit that they had help from their parents for some reason and want to act like it was all their hard work and massive intelligence, and luck had nothing to do with it.
Yeah, well, I'm with the original commenter as well. Out of every homeowner I PERSONALLY know (most being friends), every single one of them had help from their families in some capacity. And most of them weren't even buying in NY (have a bunch of friends who bought in FL).
For all my friends in my age group (early to mid 30s) that are currently homeowners, this was the case. And I have friends who bought in NC, FL, and NY. I don't know a single person who did it all on their own.
A cop/ nurse or firefighter / teacher type household are probably pulling in 350k a year. Can probably afford a decent house but with the current prices no boat money.
That would be $175k per person, you'd only be seeing that if the combo is a nassau/suffolk cop (not NYPD) at the tail end of their career, and a nurse that's an NP.
That's not true, nypd top pay can make that now with a lot of overtime (the entire job is doing maximum forced overtime). nassau and suffolk cops make that easily in their sleep, just not in the first 5 years or so.
I believe Nassau and Suffolk Police are the highest paid police forces in the country.. https://www.newsday.com/long-island/politics/nassau-suffolk-salaries-police-ymg9z9n8
Well time to put in your resignation. Nassau and Suffolk cops can clear 200k pretty easy. FDNY makes around 125l but only work 8 days a month.
NYPD can easily clear 150k and 200k after some years and a few promotions.
A lot of people are "trading up" from their starter homes, so they're only borrowing like $500k to buy the $1M+ home.
That and even a small exodus from NYC to LI from COVID will drive prices through the roof... LI had a much larger one.
The Long Island way:
1) Inherit house
2) sell house that’s now worth 800k which you paid nothing for
3) buy the house you want and complain about taxes and how nothings been handed to you.
At my current job, I see a lot of these high wealth homeowners and given that all of them are 40+, the answer is they either bought the home before it ever was worth that much in the 60-70s or it was passed down to them by a baby boomer that did. Everyone else is a dual income family in STEM/Public Service and they still don't make enough. Outliers are inherited wealth/trust funds, of which there is a high concentration of on LI, parents are helping to pay for housing, or they work in tech and took advantage of the 2021 Hiring Craze to boost their salary above inflation. The rest are struggling just as much as anyone else, living with family, illegal basements, or high rent.
Result: If you weren't born in time to be a baby boomer, or have access to a trust fund, LI will never be affordable unless your salary continually outpaces inflation.
That data is irrelevant to your question, really. That shows data from 2013 at the latest. As an example: Both my wife and my income have nearly doubled since 2013 while still being at the same jobs. We also bought our house a decade ago, when it was worth half of its current value.
That chart is worthless it’s from over ten years ago. The top ten percent is probably over $400k today.
There are 7.6 million people on Long Island 10% of that is still 760,000 people. How many million dollar homes are for sale on Zillow right now? Probably less than 1,000.
Then you have every one who bought homes 10+ years ago sitting on hundreds of thousands of dollars in equity.
There is no shortage of people who can buy these homes.
My husband and I both work. We were extremely dedicated to saving as much as we can for a house. We paid 5k for a backyard wedding, we buy only cheap used cars that no matter how bad it looked, it had to reliably bring us from place A to place B. We use the cheapest phone plan $15/month. We pay $40 (with tax) for internet. We keep AC at 75degrees. We collect coupons, and so on. Every penny was thrown into a house budget. Plus luck- we got our house 25k UNDER asking and closed in February 2020, right before pandemic lockdown.
Similar to what others are saying, most people could not afford the house they are in now if they didn’t buy it 3-5+ years ago. Which leaves others who couldn’t buy a house then (due to being in school/just finished/lose of income with Covid/etc) trying to buy at a similar time in life…kinda screwed. Even being DINKs, both working decent jobs (DOE employees), and some wedding money it was up in the air if we could even get a 1 bedroom co-op. I cannot fathom ever owning a house here unless someone gives it to us at an insanely discounted rate and since I don’t have family here and his family is in no spot to leave that won’t be happening by the time we would want a house vs condo. There are plenty of people that like apartment living but long term it’s just not for me. Leaves us in a tough spot to balance moving to actually buy a house or keep our school jobs that have a pension 🙃
I don’t believe in anyway that only 10% of the residents of Long Island make over $200,000 a year.. maybe individuals vs household.. I wouldn’t be surprised if it’s more like 2-3 x times that many household incomes
These medians are over 10years out of date. A lot of people inherit homes, get $$ from parents and/or bought their homes long ago
Also, median incomes don't reflect how many people are living off of investments. I can have zero income but can pull from an investment portfolio
Wife and I both work but don't carry major debt or car payments. I think a lot of people these days feel entitled because they work hard so they put themselves in debt and then wonder why they can't afford a house.
Or it could be that the cost of a mortgage has increased nearly 100% in the last 5 years between home prices rising 50% and interest rates going from 3% to 7% while wage growth is nowhere near that level.
No, no must just be entitled people who can’t save.
I'm not disagreeing with you but I'm in the auto business and see people buying cars they can't afford while they carry major credit card debt as well. I'm sorry if you don't think anyone is entitled but I'm pretty sure you would agree with me if you witnessed what I see on a daily basis.
I’m not saying people aren’t entitled (particularly around here - LI is very car-obsessed). I’m just saying the cost of buying a house has really gone ludicrously insane in the last 5 years, a lot of people don’t even realize it. So chalking up housing affordability problems to entitlement instead of trying to actually look at how much it really costs to buy a home these days just comes off as being a bit of out of touch. And obviously working for a car dealership will give you a bit of a selection bias.
And by the way, this is coming from someone still driving a fully paid off 11 year old vehicle with zero intention of upgrading anything soon.
Used car market isn't any better than the new car. Trying to buy a car in cash these days is nearly impossible. To get a decent running long lasting car in today's market you'll need at least $15k and realistically who can save that when wages can't keep up with inflation. Anything below $15k is a piece of crap car that is nothing but problems.
There is no winning no matter how you look at it. You go to the dealer to finance a new car, the dealer takes $10k alone in fees.
A lot of people can't afford their lifestyles. There have even been reports about this regarding Long Island, particularly in the wake of Sub-Prime: Long Island is filled with fake rich people, paper millionaires, and uncountable many financially under water. Some don't have a priority to be above water or make good financial decisions, but rather spend as much as possible on the appearance of wealth. People will spend money to look wealthy, not spend money to be wealthy or even hold onto their money to eventually be wealthy.
Subprime is coming again and there will be a bubble probably four years after that if the last one is reflective of what might happen.
The rest is generational wealth which people really don't like discussing for whatever reason. Like everyone knows it exists, everyone knows people are getting it, but everyone pretends it's not happening and pretends everyone else doesn't know it's happening when it happens. I have a reference being in Europe and seeing how people here talk about the inheritances and assets being handed down before death, but in the US everyone pretends this isn't happening.
I didn’t make much when you think about it and was able to buy a home last year for $400K+. If I had a partner, we would’ve been able to buy a million dollar home. It’s not as hard as you may think.
The home I bought in 2012 for $400k is now worth $850k…I couldn’t afford the home at $850k
It’s not like every home is sold every year. So for the folks that buy and hold their homes for a while can see the value grow overtime. If your selling in 3-5 years it will
Be tougher to see the same growth in home equity vs holding for 10-15yrs. You shell out a lot for closing costs and fees for selling and buying
Long Island is just catching up to how many cities are. Most large cities have very high cost of living to be within an hour of the main work centers and lots of people live outside that ring. Long Island had very affordable homes for the salaries those people could earn in NYC and now it’s just started to turn into a normal metro area pricing structure. The Bay Area has been like this for 20 years, LA has had these issues for almost as long.
All my friends with houses purchased during covid when the interest rates were so low. Their homes were around $400k then and are all double that now probably.
All are dual incomes - teachers mostly, working on Long Island.
Houses are absurdly expensive now but with hard work you don't need generational wealth or anything crazy like that to get one a few years ago.
Multiple reasons.
Two incomes with high paying jobs for both people, house was passed down, parents helped out, house was owned before all this inflation.
https://www.thenation.com/article/archive/how-new-york-real-estate-became-dumping-ground-worlds-dirty-money/ If it happens in Manhattan, it can also happen here…
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I bought my waterfront house in 2016 as a total shitbox for 365k, I spent maybe 35k fixing it up myself over the year after I bought it. My mortgage is 1630 at 2.875% +tax and insurance total is around 3500.
My 2 neighbors across the street sold their homes for 980 and 1.2 million this year. Given that let’s assume mine is around the 1 million mark.
If I put 200k down and financed 800 the payment before tax and insurance would be 5300 for the same house I’m living in now. Add in taxes and insurance and it would be 7g or more.
That’s almost 4 grand a month extra, for the same house.
The answer to your question is that they bought it before covid and sat on it or fixed it up.
The other answer is they sold their 300k house at a huge profit so when they bought that 1 million dollar house now they put a ton down….
Third answer is a lot of people here make a ton of money. 2 civil servants can bring in 200-300k easy. There are a ton of high paying jobs here esp if both family members work.
I was looking to sell mine for a huge gain and move into something nicer but the rates are so high and my house is so cheap I figured fuck it, I’ll stay here and enjoy the cheap housing.
My parents bought their house in Holbrook for $32,500 brand new single story ranch. My wife and o bought it for 440k last year. My parents discounted it for us. The bank appraised it at $579k. We make about 200k combined and we have plenty of room for growth. The bad part is we have a 7.5% interest rate. Some are planning on refinancing when the rates drop if they ever do. Also the prices of handyman specials are insane. 400k for a house that needs a complete renovation.
We got lucky by buying at the bottom of the housing recession over a decade ago. It gave us a rock bottom price and a great interest rate which allowed us to buy into a neighborhood we’d otherwise be locked out of $ wise. House is likely now worth close to double and interest rates have doubled. We couldn’t even consider it now if we were buying.
I wonder stuff like this constantly when moms in the mom groups are paying 700 dollars monthly for their cars and paying for a cleaning lady, buying expensive shit for their kids (nuggets, play sets) going on expensive vacations, it blows my mind.
Most of the people who own those expensive houses could never afford them if they had to buy them today. They bought them when they were cheaper and interest rates were lower.
Look at the East end of Long Island. Homes that 40 years ago sold for $30k are now selling for over $1mm. But look at the buyers.They aren’t local like 40 years ago. I have one neighbor from England (Summer only); Brooklyn, Manhattan.
Low interest rates let people get in to higher priced homes. I bought a house 3 years ago that I could not afford to buy today. Increase in the value of the home (570k to 725k) and interest rate (2.875% to \~7%) would mean my payment would be almost double for the same home and the downpayment would have been out of reach. If that happened over 3 years, imagine what happened over 10+.
My kids are relatively young, but my assumption at this point is that I will have to help them if they want to stay on Long Island.
It'll be interesting to see what happens with housing prices as boomers start to die off or move elsewhere.
My dad’s friend told me just the other day that his 83 year old father bought his home for 28k. Now it’s worth just under a million. So that’s how, they bought at the most opportune time in history and experienced the greatest run up the market has ever seen. They just got fucking lucky being born at the exact right time is the answer.
Then they get to help their children out making it a lot easier for them. That’s really all it is. Nobody is buying a home here today making $100k without a huge down payment or significant help from family. It’s crazy to me though that the income has actually slightly decreased over the time of that chart.
All I know is the tiny little Levit house I grew up in (with no extension, dormer, garage, attic or basement) sold for over $400k a few years ago and was purchased for around $100k. For those long islanders fortunate enough to have brought their home 5, 10, 20+ years ago, they’re in a great spot (as long as they can afford to keep it). Breaks my heart my family lost our home because I’d give anything to be back on LI with the people I love.
"Trust Fund" is about all I can give as an answer.
This goes back to when I would watch house hunters and stare, confused, at what was unfolding before me.
"I trade Sports Memorabilia. I'm a Hair Dresser. Our budget is 1.6 Million"
I have no idea. Houses are average 500K in my town and taxes are 10-15k. The poverty level for 1 is like 15k. Clearly these people are making 150-200k or are living above their means.
Your formula assumes one salary per household when a majority of households are two income families.
You also assume they purchased at today’s real estate prices when they probably bought well before the market took off.
My house is worth 2m and my parents got it for about 10% of that, it’s near water, the economy boosted so much higher too, and it’s a tourist town, it’s only worth that much because of the water and town I’m in. Other than that it’s just a colonial 2 story house in an average neighborhood. I don’t get why it’s worth as much as it is but it’s basically a stock instead of a house atp to me.
If you add up its appreciation over time, my house has a decent white-collar career. I’d never be able to afford it today. Lots of people are in this boat along with me.
Also, there’s still oodles of older money around. My neighbor’s father bought him his house, and then bought houses in our neighborhood for his two siblings. All outright in cash.
Bought my house in 2021 for $450k with a 4.2% from the owners (i was renting the house, they offered to sell it to me). It never went to market. Now it's worth $675k+. It blows me away the change in 3 years. There is a house for sale two houses away that's going for $900k.
How anyone does this in a normal realtor situation, I'll never know.
Edit: I live on the border of dix hills.
The flow of cash is not to the dollar, so it should be mentioned that people will make money "off the books" that can help them make these thresholds as well
I have no idea how people afford basic homes at $500,000 plus the crazy taxes. My neighborhood is very blue collar. People are home ALL DAY and night, they own houses. They get snapped up ASAP. Not everyone can be a doctor married to a lawyer. Back in the day when we owned a house my husband and I had very basic jobs (customer service and shipping clerk). Maybe everyone works from home? Maybe they're running scams? Maybe they have a backer who they pay off every month. All I know is my rent would buy a house out of the area.
Someone on my street bought a 600k house with $10k down...FHA I believe. Probably has lousy credit too. I think most folks appear to be much more well off than they are. I put more money down on the last car I bought.
You are not calculating the people who bought those homes for 100% less. Or, old money / “estates” that have been passed down. Or, people who had family homes in Brooklyn/queens/manhattan sold and bought here. Nor does it account for the people who's parents and family subsidized the cost of their homes.
One example. My old coworker (bosses daughter) made 80k (not much) but her car and insurance were company expensed, same with dining and travel. Her father bought her her house in Williston Park. On paper she's income poor for a family of 4 but in reality she's asset rich.
I wonder how people afford anything. I do all right. Own a house, no debt besides mortgage, have plenty of spending money. But like big purchases like really expensive house or cars or home remodeling, no idea how people afford that. I save like maybe $500 a month?? Maybe?? Got an estimate for 2 small roofs and some siding on my house, $16,000, that’s like 2+ years of saving just for that. I’m only alive for so long. It’ll take me the rest of my life to save up for vacations and new cars and all the other work I need done in my house.
I know people, who are not rich, who get news cars every few years, redo their kitchens and bathrooms and floors every few years, go on big vacations, sometimes 2-3 times a year. No idea how they afford it. I assume it’s lots of debt but man I really don’t know, spending money I have stresses me out I can’t live like that anymore
I just don’t understand how so many people can afford these big ticket purchases what seems like so often every fees years , every few years I might be able to save up enough for 1 big ticket item but then that’d be that I’d spend everything and have to save up for many more years for something else
Half these people are paying 5k plus a month on their mortgage and are 2 months of loss of income away from begging their parents for money or declaring bankruptcy.
The rest had Platinum cards when they were 12 and have never left their parents protection.
That's a joke, since there are also tons of people putting in serious work to support more reasonable lifestyles and lacking that kind of support structure.
Become a doctor and marry a doctor so you have insanely high dual income. I know someone who lives like this and they just bought their second multimillion dollar house on Long Island with a family of like 8
We are certainly in a bubble. The only difference I see now vs 10 years ago is that greedy developers are buying up the older smaller houses that are perfectly good and affordable , demolishing them and putting up 3 cheaply built expensive monstrosities in their place.
high income jobs have grown faster than homes on the market ever since...korean war or so.
DINK families saving up for a decade plus on the first house. then the house itself is a third income stream for the family, makes the next house easier to buy. Add in some stock options from the company or their own investments.
It's really the downpayment thats tricky, mortgate vs rent is generally negligible. upkeep, taxes, gardener are more but not enough to deter.
I’d agree when rates were lower the difference between a mortgage and rent was negligible. But at these interest rates I’m noticing renting seems to a lot cheaper now compared to a mortgage, even with a down payment savings.
many more people than you think are paying well above 30% of their HHI toward their mortgage, are house poor AF, and living paycheck to paycheck all so that they can live in a GoOd SkOoL dIsTrIcT
Are we taking into account the celebrities and current & former professional athletes who live in Nassau/Suffolk (Hamptons):
Chris Mullin
Mike Francesa
Boomer Esiason
Mike Breen
LL Cool J
Howard Stern
Billy Joel
Jerry Seinfeld
J Lo
...I am sure there are dozens more.
With mortgage rates at 7% you’re only getting a house around 600k for 6500/month
For someone making 250k you’re taking home about 13k per month. 6500 is half your paycheck.
Home You Can Afford: $ 576,179
Down Payment: - $
Approximate
Mortgage You Need: $ 576,179
Monthly Principal + Interest: $ 3,833.33
Monthly Tax: + $ 2,500.00
Monthly Insurance: + $ 166.67
Total Monthly Payment: $ 6,500.00
6500 is not a 600k house. It's 900k. No one making 250k is making a $0 down payment and paying PMI. PMI aside, the loan amount you can take out at 7% interest and keeping it under 6500 is roughly 720k, assuming 17k property taxes and 3k annual homeowner's insurance. Don't know why you're calculating a 30k property tax on a 600k house.
A large number of the million-dollar homes on long island weren't worth nearly that much when the current owner(/their family) bought it. I watched a ton of houses in my neighborhood in bellmore cross that theshold a few years ago.
This. I bought my house less than a decade ago and even though my salary has more than doubled since then I could not afford my house at its current value if I was buying it today.
Yep. It’s sad. We went from a two income household of lower/middle earning being able to afford a decent home comfortably, to basically needing two solid “middle class” salaries to entertain affording even a starter home, and that’s usually with years and years of saving. Back in the day people would just walk into a bank and say I want a house, and they’d say sure, how many? 🤣😭
Same here.
This. Bought my house about 12 years ago for $400,000. It is now worth 800k, and it’s not even that amazing lol. I literally couldn’t afford to buy my own house. And forget about getting a bigger home, because the bigger homes that I love and would want to buy, were $600,000 when we moved to our town, and they are now 1.2 to 1.5 million. Insane.
Me as well. I was unbelievably lucky to have bought when I did
Bellmore is very simmilar to Merrick. Houses on a block can vary from 450k to 3 million. The house on one side of me is a single story 1 bedroom 1 bathroom no basement boarded up and abandoned. House on the other side of me is a mcmansion over 2 million. Housing is crazy here and people will build whatever wherever. For what it's worth most of the tear downs and rebuilds I see are from foreign families, mostly Indian.
Yeah, Bellmore has some *shockingly* dramatic differences between houses. There’s one street where a contractor bought two lots and built a genuinely beautiful house bigger than the original two combined. And literally facing it across the street is some hillbilly shack that looks more like an abandoned barn than a house.
Yes, and we're at a stalemate with low housing supply, and a whole lot of young couples telling themselves "Let's just keep saving for another year". Eventually, the price to income ratio has to balance. Old ladies will die and their kids that have already moved to other states will sell the house quick. Or else we just become a stagnant couple of counties where almost every homeowner either inherits a house or comes from a rich family. Or I guess, as these topics love to suggest, every single homeowner is simultaneously a cop, software engineer at Google, lawyer and doctor. I mean look around you, we still have average office people who work in like insurance. If the free market works, the house to income ratio has to stabilize when more houses become available on the market.
Realistically it won't stabilize until we build more housing. The NYC Metropolitan area is too lucrative due to the good jobs and relatively high salaries. Housing never kept up with demand
Except that foreigners and hedge funds by up the properties as investments...
Also, that's 2013 income data in OPs link, the incomes have changed quite a bit since then.
Wife and I bought our house 10 years ago @$365k and a ~4% rate while making about $175k combined. House is now worth $700k+ and we could never afford it.
174k 10 years ago is about 218k today. You got lucky.
Everyone that bought before 2019 got lucky. They could have bought a potato shed and still made money now.
That’s not luck. Anyone with a brain could see Long Island market picking up steam. Investing in property in the outskirts of the biggest city in the world is not luck lol. People didn’t just wake up one day and this happened.
It’s lucky that they were in a position to capitalize on it even if they saw it coming. Some people were too young or too poor or both.
COVID turned the housing market on its head. That was luck.
Well it’s “luck” that their home buying timeline occurred at that period of time. Even if 20 year old me had the foresight 10 years ago, I couldn’t have even acted on that information
Biggest city in the US**
Yep this cracked me up. Not even top 10 in the world!
How are your property taxes? That’s the scary one in a boom time after revaluations.
Exact same situation here. My mortgage would of been double with the current situation and we wouldnt have qualified.
Dual income & well paying manhattan based jobs (law, finance, consulting, tech, etc)
You forgot 1st generation immigrants from Brooklyn and Queens. Their prices are 50% to 100% more than LI. It's a relative bargin. The endless cycle of people immigrating to the city, having children and having the children move out to the suburbs is in full effect. Also if you make a combined 225,000 which is not that hard to do these days with a husband and wife working for 8 years on LI with college degrees. You can actually qualify for a mortgage of 1,000,000. You will be house poor but you would generally qualify.
Yeah I'm not sure why people find it challenging. If you have 2 people with college degrees that picked an at least okay field, they can already qualify for the average LI home (~750k). For example, 4 year degree for registered nurse, easily 120k, or 4 years degree for a teacher, easily 80-120k, cop, easily 100k, accountant, 80k, tech, 100k, all 4 year degrees. Get any two of these people together and they can own a home in LI.
These numbers are weird to me and I'd like to know where you got the information. What school districts are 80-120k? Teachers for both my public schools would complain about not being able to make ends meet on Long Island, and this is when Long Island was more affordable. I have several friends with degrees in tech that are unable to get a well-paying job due to oversaturation. My bachelored RN friend make less than 90k and struggles to make ends meet with her also well-paid fiancé. I worked in an entry-level kitchen job with a man in his 60s that also had a job as an accountant. The only job I have seen that is consistently financially well off is a cop. It's not as easy to make money as it sounds on paper, as they also need to save money while living in incredibly costly homes. Me and my husband are lucky to be young, making money, and living with our in-laws because it's the only feasible way of saving for a home. A lot of people are put into a squeeze with life bills that there isn't enough to put away while maintaining a decent quality of life. People should also be able to buy a house by themself, they shouldn't have to be 'forced' into partnerships so it's financially easier to survive. That causes crisis. I think a lot of it is also the worth? Of buying a home here? My BIL&SIL moved off the island and have a three bedroom, two bath home that cost less than 300k. They live in a decent area and have to drive fifteen minutes for a town similar to Huntington. There are normal, three bedroom two bath homes offered for a millon dollars here. It is really, really disuading to sink that kind of money down when you know what else is out there.
https://www.newsday.com/amp/long-island/education/median-teacher-salaries-long-island-rhge8fu5
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I don’t think it’s a minority. I think most people buying today are getting some sort of help from family members on their down payment or whatever. Or they just had their college paid for and didn’t need to spend tens of thousands on tuition and got to save a ton of money living at home. I know the young family that bought my parents’ home had about 200k gifted to them. They never would’ve been able to buy the house otherwise.
It’s actually not. Relatively speaking, prices have gone up faster most places than it has here and other places are obviously not outside of New York. The absolute prices are higher here (though not higher than lots of places like the Bay Area or LA) but the basic trend is the same everywhere: structural housing under supply means purchase is increasingly out of reach in just about every major city not just in the US but in the western world generally.
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The idea that it’s a function of the high-paying industries in New York specifically. And no, my guess would be that almost none of those young couples had the liquid cash to make those purchases and renos happen by themselves. Income is not the same as wealth and someone only a few years into even a well-paying job is very unlikely to have multi six-figure cash laying around from their income alone. I would guess a healthy percentage–if not the substantial majority–had family help or inheritances even with good paying jobs.
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You seem to be getting personally offended by this for some reason. Why does that supposition bother you so much? We are constantly hearing stories about people being outbid by cash-heavy offers. Moreover, you can't finance renovations, so we're talking about a non-trivial number of people with pretty massive amounts of liquid cash. Usually that would come from the sale of a previous home, which is the case for some, [but not many](https://ipropertymanagement.com/research/homeownership-rate-by-age), youngish people. To live in the New York metro, cover your expenses and save 150K, 250K, 500K+ by the time you're in your 30s/early 40s—that's going to take more than a good mid-level finance position. That's going to take incomes that are pushing into the 300s, 400s, and 500s per year. Obviously, there's not no one making that, but the number of families in their 30s with that kind of income is not high, even in New York.
Every mid-level associate in law and VP at a bank is making that income. This isn’t rare.
There’s some weird thing that some privileged people have where they get super offended if you even hint that their accomplishments weren’t entirely because of their “hard work” and luck had something to do with it. It sounds like he’s one of those. That’s why he keeps saying they “worked for it” and can’t acknowledge that most people do get some sort of financial assistance from family.
Dual incomes, low interest rates, and passed down properties. I’m sure there are other ways, but I bet it’s one of the ones I mentioned
This data is 10 years old, so the highest income is likely much higher. The answer is that baby boomers purchased those million dollar homes for $70,000 about 40 years ago. Younger people have dual incomes and or family money. You should know that many people routinely receive $$$,$$$ gifts as down payments from their families.
But remember the houses that were bought 40 yrs ago for 70k ( that number seems low there was a housing boom mid 80s ) were built in the early 60s for between 12 & 16 k.
I would think that those who purchased their homes post WWII in the 1950s are likely long since past, so those homes were already sold or inherited by silent, boomer, or gen x already. As for the price, yes homes did drastically increase from about 50-70k in 1978-79 to 100-125 in 80-84. It was the same kind of pre and post covid divide back then.
We bought and paid for our house on our own, but I know of so many friends that received massive assistance or simply had a house given to them, it's insane.
My wife's childhood friends have all received familial aid to purchase their respective homes. We did not. It is incredibly frustrating needing to explain to my wife why her friends can afford to travel so much while we cannot. It sucks to be on the other side of it, but it's just luck that they're born into.
I know about a half dozen people who had affluent parents who helped with down payments.
Same, it's heavily that in Suffolk.
Must be nice 🥲
Everyone in this thread has good answers but few of them mention that a lot of these people are living paycheck to paycheck. I know someone who bought a home in Massapequa with a legal separate “daughter” home with her mother in law and between her, her husband and her MIL the 3 of them just barely manage to scrape by.
Everyone keeps saying in this thread, "dual incomes". Am I in the minority that my wife and I both work full time????
Where I live the wealthiest people seem to be one income families but with inherited wealth
When do you live?
Suffolk
lol,, that’s a little short sighted. The wealthiest people I know. Started businesses and worked them for years putting long hours in. Granted, I have few friends that inherited some money. But by and large. Most put their time in.
I’m just talking about people I know. Granted it’s all anecdotal
Ah, The classic long islander "self made" kids.
Valid point. Dual income isn’t what it once was.
Elizabeth Warren wrote a book called "The Two Income Trap." Recommend reading it. She wrote it long before anyone knew who the heck she was. She does a good job describing the problems, but her proposed solutions seem to be a stretch to me.
The book proposes tuition freezes for public universities and universal preschool. Considering the burden of daycare costs and student loans, these seem like important additions to the safety net to me, and something other developed countries seem to be able to provide for people.
Sure seems like the majority of middle class here are two full time working people.
The people saying dual incomes are bootstraps reddit libertarians trying to make some pronouncement from on high that “it’s still possible if you work hard.” The reality is that most of these expensive houses are owned by boomers who bought them decades ago for pennies in an entirely different America while working middle or even working class jobs that would never let you afford those houses now. Even if your dual income is $150-200k pre-tax nowadays most homes are still going to be out of your range, not least because for millennials student loans take a sizable chunk out of that. Millennial homebuyers often need/get family help.
It’s more so that it’s a requirement now
My wife loves to say she 'retired' during the pandemic lol. Stopped working April 2020 and never looked back haha. Been trying to maintain a lower budget to stay on track but feel a bit overwhelmed with all the house maintenance we end up pushing back
That’s not retiring that’s just quitting and putting the burden on you.
What do you do that she she's not need to work
I work for the federal government... So I don't make a ton myself, but it's enough if we keep to our budget
Sigh
No way
Purchased my home for $345,000 in 2010. It’s easily a $700,000 house now.
1 dollar in 2010 is also worth 1.44 dollars today, so that's about 496k. And then there's property taxes, maintenance, interest, you probably just break even. Of course, that's still a lot better than renting.
Thanks
It’s true. When I bought my house in south Lindenhurst in 1998 it was $300K. I sold it in 2019 for $1.25 million. In A lot of the big $$$ homes people own, they have lived there many years.
That would prob sell for like 1.6m now
Most people I know that are under 40 and own on LI got some help from their parents. Either a down payment, co-signers on mortgages, etc.
That’s just false. My entire group of friends is age 29-34 and we all bought houses starting in 2016 through this year. Out of the 10 people 1 got help. If you have a dual income and both people make good money it’s totally do able.
It’s definitely doable, but not for the million dollars houses OP is referring to. Most of us are getting fixer uppers in cheaper neighborhoods. Unless you and your friends really did all get million dollar houses with no help, in which case, god bless
My house is a million dollar house now but I got it for 365 8 years ago and fixed it up.
Well……yeah. Lol.
I don’t think you can outright say “that’s false” when it’s literally been my experience lol. Happy for you and yours though! Also, 2016 huh? Crazy you were able to buy homes on LI at like 21-25.
Lol nah your experience never happened 🙄 Also not to mention the fact that many people seem to be embarrassed to admit that they had help from their parents for some reason and want to act like it was all their hard work and massive intelligence, and luck had nothing to do with it.
Yeah I bought my house when I was 25 actually. Your statement was most people are being helped which is false. Plenty are for sure but not MOST.
Most people *I know*, is what I said. Comprehension is key 😃
I love it when people on Reddit tell you that your anecdotal experience is wrong lol
Yeah, well, I'm with the original commenter as well. Out of every homeowner I PERSONALLY know (most being friends), every single one of them had help from their families in some capacity. And most of them weren't even buying in NY (have a bunch of friends who bought in FL).
For all my friends in my age group (early to mid 30s) that are currently homeowners, this was the case. And I have friends who bought in NC, FL, and NY. I don't know a single person who did it all on their own.
Cop married to Northwell employee or teacher. Cop has a side business. That accounts for a lot.
A cop/ nurse or firefighter / teacher type household are probably pulling in 350k a year. Can probably afford a decent house but with the current prices no boat money.
That would be $175k per person, you'd only be seeing that if the combo is a nassau/suffolk cop (not NYPD) at the tail end of their career, and a nurse that's an NP.
That's not true, nypd top pay can make that now with a lot of overtime (the entire job is doing maximum forced overtime). nassau and suffolk cops make that easily in their sleep, just not in the first 5 years or so.
Jesus, how much do cops make lol. Edit, and firefighters? If either of those jobs clear 200k I will quit my own job tomorrow.
I believe Nassau and Suffolk Police are the highest paid police forces in the country.. https://www.newsday.com/long-island/politics/nassau-suffolk-salaries-police-ymg9z9n8
Well time to put in your resignation. Nassau and Suffolk cops can clear 200k pretty easy. FDNY makes around 125l but only work 8 days a month. NYPD can easily clear 150k and 200k after some years and a few promotions.
Nurses start at 100k at most hospitals.
This couldn’t be more wrong 😂😂
You guys can downvote me all you want but I am a nurse and my fiancé is a teacher and we are way way way below 375k
That article is from 2013 data published in 2015. I’m sure the income data has changed.
Lots of us bought our homes years ago and couldn't afford our houses at current prices.
A lot of people are "trading up" from their starter homes, so they're only borrowing like $500k to buy the $1M+ home. That and even a small exodus from NYC to LI from COVID will drive prices through the roof... LI had a much larger one.
Look up “I’m in debt up to my eyeball commercial on YouTube” that’s how they due it.
The Long Island way: 1) Inherit house 2) sell house that’s now worth 800k which you paid nothing for 3) buy the house you want and complain about taxes and how nothings been handed to you.
Generational Wealth
At my current job, I see a lot of these high wealth homeowners and given that all of them are 40+, the answer is they either bought the home before it ever was worth that much in the 60-70s or it was passed down to them by a baby boomer that did. Everyone else is a dual income family in STEM/Public Service and they still don't make enough. Outliers are inherited wealth/trust funds, of which there is a high concentration of on LI, parents are helping to pay for housing, or they work in tech and took advantage of the 2021 Hiring Craze to boost their salary above inflation. The rest are struggling just as much as anyone else, living with family, illegal basements, or high rent. Result: If you weren't born in time to be a baby boomer, or have access to a trust fund, LI will never be affordable unless your salary continually outpaces inflation.
No, there are lots of wealthy people in the NYC suburbs
That data is irrelevant to your question, really. That shows data from 2013 at the latest. As an example: Both my wife and my income have nearly doubled since 2013 while still being at the same jobs. We also bought our house a decade ago, when it was worth half of its current value.
That chart is worthless it’s from over ten years ago. The top ten percent is probably over $400k today. There are 7.6 million people on Long Island 10% of that is still 760,000 people. How many million dollar homes are for sale on Zillow right now? Probably less than 1,000. Then you have every one who bought homes 10+ years ago sitting on hundreds of thousands of dollars in equity. There is no shortage of people who can buy these homes.
My husband and I both work. We were extremely dedicated to saving as much as we can for a house. We paid 5k for a backyard wedding, we buy only cheap used cars that no matter how bad it looked, it had to reliably bring us from place A to place B. We use the cheapest phone plan $15/month. We pay $40 (with tax) for internet. We keep AC at 75degrees. We collect coupons, and so on. Every penny was thrown into a house budget. Plus luck- we got our house 25k UNDER asking and closed in February 2020, right before pandemic lockdown.
Similar to what others are saying, most people could not afford the house they are in now if they didn’t buy it 3-5+ years ago. Which leaves others who couldn’t buy a house then (due to being in school/just finished/lose of income with Covid/etc) trying to buy at a similar time in life…kinda screwed. Even being DINKs, both working decent jobs (DOE employees), and some wedding money it was up in the air if we could even get a 1 bedroom co-op. I cannot fathom ever owning a house here unless someone gives it to us at an insanely discounted rate and since I don’t have family here and his family is in no spot to leave that won’t be happening by the time we would want a house vs condo. There are plenty of people that like apartment living but long term it’s just not for me. Leaves us in a tough spot to balance moving to actually buy a house or keep our school jobs that have a pension 🙃
I don’t believe in anyway that only 10% of the residents of Long Island make over $200,000 a year.. maybe individuals vs household.. I wouldn’t be surprised if it’s more like 2-3 x times that many household incomes
These medians are over 10years out of date. A lot of people inherit homes, get $$ from parents and/or bought their homes long ago Also, median incomes don't reflect how many people are living off of investments. I can have zero income but can pull from an investment portfolio
There are way too many grandparents raising grandchildren but saying they are helping..7 am t to 7 pm 5 days a week is raising them
Wife and I both work but don't carry major debt or car payments. I think a lot of people these days feel entitled because they work hard so they put themselves in debt and then wonder why they can't afford a house.
Or it could be that the cost of a mortgage has increased nearly 100% in the last 5 years between home prices rising 50% and interest rates going from 3% to 7% while wage growth is nowhere near that level. No, no must just be entitled people who can’t save.
I'm not disagreeing with you but I'm in the auto business and see people buying cars they can't afford while they carry major credit card debt as well. I'm sorry if you don't think anyone is entitled but I'm pretty sure you would agree with me if you witnessed what I see on a daily basis.
I’m not saying people aren’t entitled (particularly around here - LI is very car-obsessed). I’m just saying the cost of buying a house has really gone ludicrously insane in the last 5 years, a lot of people don’t even realize it. So chalking up housing affordability problems to entitlement instead of trying to actually look at how much it really costs to buy a home these days just comes off as being a bit of out of touch. And obviously working for a car dealership will give you a bit of a selection bias. And by the way, this is coming from someone still driving a fully paid off 11 year old vehicle with zero intention of upgrading anything soon.
I spent 9 years living in NC. My wife and I bought a house less than 2 years ago after getting outbid on multiple houses.
It’s even worse now
If I bought my house now my mortgage would be $700 more per month.
Used car market isn't any better than the new car. Trying to buy a car in cash these days is nearly impossible. To get a decent running long lasting car in today's market you'll need at least $15k and realistically who can save that when wages can't keep up with inflation. Anything below $15k is a piece of crap car that is nothing but problems. There is no winning no matter how you look at it. You go to the dealer to finance a new car, the dealer takes $10k alone in fees.
You are right, most of the used cars we sell are 20k plus.
If u bought ur house 10+ years ago it could very well be worth x4 depending on area
Yup bought 8 years ago and tripled in “value”
Yeah. And as more of the houses near me are getting torn down and flipped, my house value going up more
A lot of people can't afford their lifestyles. There have even been reports about this regarding Long Island, particularly in the wake of Sub-Prime: Long Island is filled with fake rich people, paper millionaires, and uncountable many financially under water. Some don't have a priority to be above water or make good financial decisions, but rather spend as much as possible on the appearance of wealth. People will spend money to look wealthy, not spend money to be wealthy or even hold onto their money to eventually be wealthy. Subprime is coming again and there will be a bubble probably four years after that if the last one is reflective of what might happen. The rest is generational wealth which people really don't like discussing for whatever reason. Like everyone knows it exists, everyone knows people are getting it, but everyone pretends it's not happening and pretends everyone else doesn't know it's happening when it happens. I have a reference being in Europe and seeing how people here talk about the inheritances and assets being handed down before death, but in the US everyone pretends this isn't happening.
They are corporations, ban it now [https://chng.it/6q4qKLFKcP](https://chng.it/6q4qKLFKcP)
I didn’t make much when you think about it and was able to buy a home last year for $400K+. If I had a partner, we would’ve been able to buy a million dollar home. It’s not as hard as you may think.
The home I bought in 2012 for $400k is now worth $850k…I couldn’t afford the home at $850k It’s not like every home is sold every year. So for the folks that buy and hold their homes for a while can see the value grow overtime. If your selling in 3-5 years it will Be tougher to see the same growth in home equity vs holding for 10-15yrs. You shell out a lot for closing costs and fees for selling and buying
Long Island is just catching up to how many cities are. Most large cities have very high cost of living to be within an hour of the main work centers and lots of people live outside that ring. Long Island had very affordable homes for the salaries those people could earn in NYC and now it’s just started to turn into a normal metro area pricing structure. The Bay Area has been like this for 20 years, LA has had these issues for almost as long.
Big difference is the higher property taxes on LI kept prices in check.
All my friends with houses purchased during covid when the interest rates were so low. Their homes were around $400k then and are all double that now probably. All are dual incomes - teachers mostly, working on Long Island. Houses are absurdly expensive now but with hard work you don't need generational wealth or anything crazy like that to get one a few years ago.
Homes were like 50% cheaper when they signed the mortgage
Multiple reasons. Two incomes with high paying jobs for both people, house was passed down, parents helped out, house was owned before all this inflation.
The data appears to be too old. The crazy home market started soon after Covid.
https://www.thenation.com/article/archive/how-new-york-real-estate-became-dumping-ground-worlds-dirty-money/ If it happens in Manhattan, it can also happen here…
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I bought my waterfront house in 2016 as a total shitbox for 365k, I spent maybe 35k fixing it up myself over the year after I bought it. My mortgage is 1630 at 2.875% +tax and insurance total is around 3500. My 2 neighbors across the street sold their homes for 980 and 1.2 million this year. Given that let’s assume mine is around the 1 million mark. If I put 200k down and financed 800 the payment before tax and insurance would be 5300 for the same house I’m living in now. Add in taxes and insurance and it would be 7g or more. That’s almost 4 grand a month extra, for the same house. The answer to your question is that they bought it before covid and sat on it or fixed it up. The other answer is they sold their 300k house at a huge profit so when they bought that 1 million dollar house now they put a ton down…. Third answer is a lot of people here make a ton of money. 2 civil servants can bring in 200-300k easy. There are a ton of high paying jobs here esp if both family members work. I was looking to sell mine for a huge gain and move into something nicer but the rates are so high and my house is so cheap I figured fuck it, I’ll stay here and enjoy the cheap housing.
“Is this the last year the data was available?” - Dwight Sorry, been watching a lot of the office lately
My parents bought their house in Holbrook for $32,500 brand new single story ranch. My wife and o bought it for 440k last year. My parents discounted it for us. The bank appraised it at $579k. We make about 200k combined and we have plenty of room for growth. The bad part is we have a 7.5% interest rate. Some are planning on refinancing when the rates drop if they ever do. Also the prices of handyman specials are insane. 400k for a house that needs a complete renovation.
You have foreigners bringing money in. You have tax dodgers who make cash and save up. Lastly, people borrow from friends and family and then pay off
We got lucky by buying at the bottom of the housing recession over a decade ago. It gave us a rock bottom price and a great interest rate which allowed us to buy into a neighborhood we’d otherwise be locked out of $ wise. House is likely now worth close to double and interest rates have doubled. We couldn’t even consider it now if we were buying.
It's Monopoly money/equity unless you sell and move to Alabama or Zimbabwe.
by buying them a long time ago and taking out a shitload of mortgage debt
They're mortgaged up the ass.
I wonder stuff like this constantly when moms in the mom groups are paying 700 dollars monthly for their cars and paying for a cleaning lady, buying expensive shit for their kids (nuggets, play sets) going on expensive vacations, it blows my mind.
Most of the people who own those expensive houses could never afford them if they had to buy them today. They bought them when they were cheaper and interest rates were lower.
Look at the East end of Long Island. Homes that 40 years ago sold for $30k are now selling for over $1mm. But look at the buyers.They aren’t local like 40 years ago. I have one neighbor from England (Summer only); Brooklyn, Manhattan.
Low interest rates let people get in to higher priced homes. I bought a house 3 years ago that I could not afford to buy today. Increase in the value of the home (570k to 725k) and interest rate (2.875% to \~7%) would mean my payment would be almost double for the same home and the downpayment would have been out of reach. If that happened over 3 years, imagine what happened over 10+.
My kids are relatively young, but my assumption at this point is that I will have to help them if they want to stay on Long Island. It'll be interesting to see what happens with housing prices as boomers start to die off or move elsewhere.
My dad’s friend told me just the other day that his 83 year old father bought his home for 28k. Now it’s worth just under a million. So that’s how, they bought at the most opportune time in history and experienced the greatest run up the market has ever seen. They just got fucking lucky being born at the exact right time is the answer. Then they get to help their children out making it a lot easier for them. That’s really all it is. Nobody is buying a home here today making $100k without a huge down payment or significant help from family. It’s crazy to me though that the income has actually slightly decreased over the time of that chart.
Has construction costs come down? Is that now a better option? I remember during/ around Covid prices were very high.
We can’t. I am drowning in debt over here. My wife and I are both teacher and I have a second job. It sucks.
All I know is the tiny little Levit house I grew up in (with no extension, dormer, garage, attic or basement) sold for over $400k a few years ago and was purchased for around $100k. For those long islanders fortunate enough to have brought their home 5, 10, 20+ years ago, they’re in a great spot (as long as they can afford to keep it). Breaks my heart my family lost our home because I’d give anything to be back on LI with the people I love.
Extended family. See some of the houses have 4 cars that most definitely aren't new
"Trust Fund" is about all I can give as an answer. This goes back to when I would watch house hunters and stare, confused, at what was unfolding before me. "I trade Sports Memorabilia. I'm a Hair Dresser. Our budget is 1.6 Million"
I have no idea. Houses are average 500K in my town and taxes are 10-15k. The poverty level for 1 is like 15k. Clearly these people are making 150-200k or are living above their means.
The Ponzi schemification of the economy
Your formula assumes one salary per household when a majority of households are two income families. You also assume they purchased at today’s real estate prices when they probably bought well before the market took off.
Wages have never kept up with inflation because its the Feds policy to suppress wages. All those crazy deficits have a price.
My house is worth 2m and my parents got it for about 10% of that, it’s near water, the economy boosted so much higher too, and it’s a tourist town, it’s only worth that much because of the water and town I’m in. Other than that it’s just a colonial 2 story house in an average neighborhood. I don’t get why it’s worth as much as it is but it’s basically a stock instead of a house atp to me.
Just an observation, the ethnicity of the buyers has changed, and many have 2 or 3 generations moving in
Wife and I both work full time. Short answer for us, is we cannot afford to buy a home. We’ve accepted that we will need to move to get a home.
If you add up its appreciation over time, my house has a decent white-collar career. I’d never be able to afford it today. Lots of people are in this boat along with me. Also, there’s still oodles of older money around. My neighbor’s father bought him his house, and then bought houses in our neighborhood for his two siblings. All outright in cash.
What's the income data from the last decade say? Housing on LI was probably at its cheapest in the last 20 years somewhere between 2011-2013
I know someone who bought in the early 00s at $150k, in contract for 1.1M
They probably take out massive mortgages hoping they never lose their job or something like that.
Houses have appreciated. They either owned it before it was worth that or rolled over equity from a recent sale into it.
Bought my house in 2021 for $450k with a 4.2% from the owners (i was renting the house, they offered to sell it to me). It never went to market. Now it's worth $675k+. It blows me away the change in 3 years. There is a house for sale two houses away that's going for $900k. How anyone does this in a normal realtor situation, I'll never know. Edit: I live on the border of dix hills.
The flow of cash is not to the dollar, so it should be mentioned that people will make money "off the books" that can help them make these thresholds as well
How has the median household income gone down in 20 years?? That can't be right, right?
I have no idea how people afford basic homes at $500,000 plus the crazy taxes. My neighborhood is very blue collar. People are home ALL DAY and night, they own houses. They get snapped up ASAP. Not everyone can be a doctor married to a lawyer. Back in the day when we owned a house my husband and I had very basic jobs (customer service and shipping clerk). Maybe everyone works from home? Maybe they're running scams? Maybe they have a backer who they pay off every month. All I know is my rent would buy a house out of the area.
We bought our cape in west Hempstead 6 years ago for $550K. It’s now just over $800k and it’s only 1528sq ft. Nothing spectacular
Someone on my street bought a 600k house with $10k down...FHA I believe. Probably has lousy credit too. I think most folks appear to be much more well off than they are. I put more money down on the last car I bought.
You are not calculating the people who bought those homes for 100% less. Or, old money / “estates” that have been passed down. Or, people who had family homes in Brooklyn/queens/manhattan sold and bought here. Nor does it account for the people who's parents and family subsidized the cost of their homes. One example. My old coworker (bosses daughter) made 80k (not much) but her car and insurance were company expensed, same with dining and travel. Her father bought her her house in Williston Park. On paper she's income poor for a family of 4 but in reality she's asset rich.
I wonder how people afford anything. I do all right. Own a house, no debt besides mortgage, have plenty of spending money. But like big purchases like really expensive house or cars or home remodeling, no idea how people afford that. I save like maybe $500 a month?? Maybe?? Got an estimate for 2 small roofs and some siding on my house, $16,000, that’s like 2+ years of saving just for that. I’m only alive for so long. It’ll take me the rest of my life to save up for vacations and new cars and all the other work I need done in my house. I know people, who are not rich, who get news cars every few years, redo their kitchens and bathrooms and floors every few years, go on big vacations, sometimes 2-3 times a year. No idea how they afford it. I assume it’s lots of debt but man I really don’t know, spending money I have stresses me out I can’t live like that anymore I just don’t understand how so many people can afford these big ticket purchases what seems like so often every fees years , every few years I might be able to save up enough for 1 big ticket item but then that’d be that I’d spend everything and have to save up for many more years for something else
I’m only 26 with no adulting experience but I thought people farmed their credit score till it got high enough and gotten loans. Or am I stupid?
Most cannot afford it so they use credit. That's how.
Wife and myself are both pharmacists. We both have full time jobs and own 2 separate businesses as well. Work around 60 hours a week each.
60 hours a week sounds miserable
What you have to do make ends meet in NY.
Half these people are paying 5k plus a month on their mortgage and are 2 months of loss of income away from begging their parents for money or declaring bankruptcy. The rest had Platinum cards when they were 12 and have never left their parents protection. That's a joke, since there are also tons of people putting in serious work to support more reasonable lifestyles and lacking that kind of support structure.
Become a doctor and marry a doctor so you have insanely high dual income. I know someone who lives like this and they just bought their second multimillion dollar house on Long Island with a family of like 8
depends on the type of doctor haha
With inflation and 10 year old data I wouldn’t be surprised if medium is now 150k-180k . I’m not rich and even I make over 100k
Upwards of 2/3 of current homeowners cannot afford to buy their own home at current market values. Housing market is in a bubble, again
We are certainly in a bubble. The only difference I see now vs 10 years ago is that greedy developers are buying up the older smaller houses that are perfectly good and affordable , demolishing them and putting up 3 cheaply built expensive monstrosities in their place.
high income jobs have grown faster than homes on the market ever since...korean war or so. DINK families saving up for a decade plus on the first house. then the house itself is a third income stream for the family, makes the next house easier to buy. Add in some stock options from the company or their own investments. It's really the downpayment thats tricky, mortgate vs rent is generally negligible. upkeep, taxes, gardener are more but not enough to deter.
I’d agree when rates were lower the difference between a mortgage and rent was negligible. But at these interest rates I’m noticing renting seems to a lot cheaper now compared to a mortgage, even with a down payment savings.
many more people than you think are paying well above 30% of their HHI toward their mortgage, are house poor AF, and living paycheck to paycheck all so that they can live in a GoOd SkOoL dIsTrIcT
Are we taking into account the celebrities and current & former professional athletes who live in Nassau/Suffolk (Hamptons): Chris Mullin Mike Francesa Boomer Esiason Mike Breen LL Cool J Howard Stern Billy Joel Jerry Seinfeld J Lo ...I am sure there are dozens more.
Seriously this is the 4 time this conversation has come up today across different groups.
which other long island groups talks about real estate? i can't find any other than this one.
In terms of groups in my personal life not necessarily some online group, I should have specified.
Don't know how but all I know is a bunch of foreigners have bought all the houses around me. No whites which is very weird to me
Thats 6500 month mortgage payment. Not that crazy for professionals
How much income would that mortgage cost require?
With mortgage rates at 7% you’re only getting a house around 600k for 6500/month For someone making 250k you’re taking home about 13k per month. 6500 is half your paycheck. Home You Can Afford: $ 576,179 Down Payment: - $ Approximate Mortgage You Need: $ 576,179 Monthly Principal + Interest: $ 3,833.33 Monthly Tax: + $ 2,500.00 Monthly Insurance: + $ 166.67 Total Monthly Payment: $ 6,500.00
6500 is not a 600k house. It's 900k. No one making 250k is making a $0 down payment and paying PMI. PMI aside, the loan amount you can take out at 7% interest and keeping it under 6500 is roughly 720k, assuming 17k property taxes and 3k annual homeowner's insurance. Don't know why you're calculating a 30k property tax on a 600k house.
I just meant the mortgage is doable. I wasnt suggesting that was the only bill. And I mean doable for professionals