Manhattan rents cross $5k threshold for first time • Hacker News Board

Re: Manhattan rents cross $5k threshold for first time

#291

Post by voidhorse » Thu, Jul 14, 2022, 3:41 PM UTC

rglullis wrote: post #254

voidhorse wrote: post #210

Earlier quoted context omitted.

Sure that’s the capitalist narrative explanation. The actual, human, explanation is that landlords see that they can get away with charging absurd rates because consumers are willing to make dumb decisions to get what they want, so they do it. I’m sick of these economic abstractions that constantly try to explain away our problems, and take away the responsibility from the human actors that cause these effects. It’s…

There is no system that can work in large scale and depend on the good will of all (or the majority of) participants. If your system only works when everyone cooperates, you don't need the system in the first place. Believing that we can all live in this utopian ideal is more religious than "believing in the market"

I’m not saying that. I’m saying it’s quite possible to introduce regulations into the existing system that force certain actors to behave. I’m not expecting anyone to behave without such restrictions, in fact this article is precisely the evidence that people will exploit others and the system when no such restrictions exist.

Many of these landlords are up charging on properties that have not been materially improved at all, because, as I said, people are making dumb decisions to live where they want to, so they can arbitrarily increase the price up to the limit of what someone will pay. This is great for landlords since they can double their money without doing any work.

Don’t get me wrong, I’m really frustrated by these incoming renters too. A lot of these people fled and abandoned the city like complete cowards when the pandemic hit and suddenly they want to return while they left the responsibility of keeping the city going on all the rest of us that are actual residents that stayed. These semi-nomadic people are just as bad as the landlords and want to live somewhere only so long as it benefits them—they have no allegiance to a community. This, in conjunction with land owners behavior creates disastrous effects for actual long-term residents who invest in the local communities and don’t run away the second things get hard.

Re: Manhattan rents cross $5k threshold for first time

#292

Post by ehnto » Thu, Jul 14, 2022, 3:41 PM UTC

nickles wrote: post #51

spaniard89277 wrote: post #36

Housing and land is a non-transable good, and therefore there should be heavy state intervention on it, preferably by doing the same as Vienna, which is holding >40% of the renting stock and charging according to income, and renting to a representative distribution of tenants so to prevent guettos. Rent is the main detractor of disposable income which hurts the rest of the economy, and property owners provide almost…

> should be heavy state intervention on it, preferably by doing the same as Vienna, which is holding >40% of the renting stock and charging according to income This is great policy if you want to make housing unaffordable. When supply is less than demand, prices go up. Those price increases incentivize builders to increase the housing stock (which subsequently lowers prices). Capping prices prevents the price mechani…

We're all very aware of how the economics should play out, but look around you, it's not working that way in a bunch of places. That's because houses are being used as investment vehicles, with rentals being thoroughly flogged because they know people have no choice but to pay. No amount of building will help if the value of the property is not intrinsically linked to the supply and demand of places to live for people who want to live there, but is instead linked or at least heavily influenced by what investors with increased buying capacity are willing to pay.

Re: Manhattan rents cross $5k threshold for first time

#293

Post by [deleted] » Thu, Jul 14, 2022, 3:41 PM UTC

fny wrote: post #233

This is a price signal. Anyone who's calling for intervention needs to wake up. The proper response is for people to leave . If you drive across America, you'll find economically, depressed areas which have suffered from brain drain. Many aspire to attend an out of state college, go work in the Valley, join some VC-funded startup, megacorp, consulting firm, and strike it rich. In all likelihood, you will (1) not stri…

[deleted]

Re: Manhattan rents cross $5k threshold for first time

#294

Post by Nimitz14 » Thu, Jul 14, 2022, 3:42 PM UTC

rpadovani wrote: post #72

Victerius wrote: post #3

Averages are skewed. Still. To meet the requirement of many landlords to earn in excess of 3x rent, one would have to earn 15k a month after tax, or 180k a year after tax. To earn 180k after tax in NY, you need to earn 300k pre tax. Your Income Taxes Breakdown Tax / Marginal Tax Rate / Effective Tax Rate / 2021 Taxes* / Federal 35.00% / 25.05% / $75,152 FICA / 2.35% / 4.70% / $14,104 State / 6.85% / 6.12% / $18,356 L…

> Income After Taxes: $181,196 What? I thought that in U.S. taxes would be so much lower than in EU! In Bavaria, Germany, the income after taxes on €300,000 euros is €168.131,35 in the highest contribution bracket, and €178.251,07 in the lowest!

In Germany you hit the higher tax brackets much quicker. I just input the numbers into a calculator and at 150k in NYC you pay 34.5 and in Bayern 43.4% taxes.

Re: Manhattan rents cross $5k threshold for first time

#295

Post by dionidium » Thu, Jul 14, 2022, 3:42 PM UTC

nix0n wrote: post #276

dionidium wrote: post #264

Earlier quoted context omitted.

> and property owners provide almost no value, but to provide access to housing for people who has no capital for it, which is service that could be perfectly provided by a state entity. Property of course requires maintenance and management, so the sleight of hand here is to define away all those aspects of ownership so that by definition all that's meant by "landlord" is "old guy who cashes checks." But somebody ha…

> But somebody has to maintain the property, somebody has to prioritize upgrades and improvements, somebody has to cut the grass In many buildings these things are simply not done.

Now that I've said some nice things about landlords, I'll say something less flattering: bad landlords find convenient cover in supply-constrained markets. Which, of course, is what we have. If you want to stick it to lazy, cheap, do-nothing landlords, then let somebody build a brand-new apt complex right next door to their crappy units and see how long they can get away with their insouciance in that kind of market.

Re: Manhattan rents cross $5k threshold for first time

#296

Post by sjtindell » Thu, Jul 14, 2022, 3:42 PM UTC

patrickthebold wrote: post #234

huevosabio wrote: post #204

Earlier quoted context omitted.

Housing =/= Land. But our policies which heavily kneecap our ability to build more [0] make it such that Housing starts behaving like Land. The solution is to build more, and the success of Vienna does not come from public intervention but from the added supply. Tokyo is another city with famously cheap housing, and the secret is that they make it easy to build. I personally think that achieving affordable housing pr…

The article is about Manhattan. Do you have any idea if it has similar problems? In my mind, Manhattan is pretty dense.

In my mind it is the same problem everywhere. Supply is too low and is kept low for many reasons. There is insane demand from around the world to live in Manhattan.

Re: Manhattan rents cross $5k threshold for first time

#297

Post by kriops » Thu, Jul 14, 2022, 3:42 PM UTC

spaniard89277 wrote: post #36

Housing and land is a non-transable good, and therefore there should be heavy state intervention on it, preferably by doing the same as Vienna, which is holding >40% of the renting stock and charging according to income, and renting to a representative distribution of tenants so to prevent guettos. Rent is the main detractor of disposable income which hurts the rest of the economy, and property owners provide almost…

> (...) there should be heavy state intervention (...)

This has been tried so many times throughout different cultures and time periods, and by different means. It will not benefit whoever is actually living on the properties, but will detract from their situation.

Economics in One Lesson by Henry Hazlitt has several concrete examples of attempted interventions, and is written to give a basic intuition on why this happens (Spoiler: Opportunity costs).

The only permanent solution is just to build more buildings, or at a political level simply making it easier to build new buildings, which directly increases supply and thus causes the lowering of prices. This makes perfect sense when you think about it: There are not enough buildings, so we need to have more buildings.

Re: Manhattan rents cross $5k threshold for first time

#298

Post by DeathArrow » Thu, Jul 14, 2022, 3:43 PM UTC

spaniard89277 wrote: post #36

Housing and land is a non-transable good, and therefore there should be heavy state intervention on it, preferably by doing the same as Vienna, which is holding >40% of the renting stock and charging according to income, and renting to a representative distribution of tenants so to prevent guettos. Rent is the main detractor of disposable income which hurts the rest of the economy, and property owners provide almost…

>The current setup creates guettos by default, by siloing people with different monetary and social capital into different building and areas, hurting social mobility,

Maybe some groups of people don't want to live together with other groups of people? Different people living in different parts of the city is just natural evolution.

Why should the state force them to live together?

And why should the state tell you where to live? Why should the state be involved in your private life at all?

Re: Manhattan rents cross $5k threshold for first time

#299

Post by knowledge-clay » Thu, Jul 14, 2022, 3:43 PM UTC

jononomo wrote: post #68

I decided about four years ago that it just doesn’t make sense to live in NYC if you’re not making $200k/year consistently. Also, I was surprised at how many people without an original thought in their head earn $200k/year in NYC —- the city rewards a sort of dull ambition. Do you want to hang out with people who are intelligent and ambitious yet somehow fail to be interesting? If so, then NYC is for you!

The median individual income in NYC is $34k. In Manhattan, it's $52k. Making 200k puts you in the top 5% of earners in New York City.

Re: Manhattan rents cross $5k threshold for first time

#300

Post by PolCPP » Thu, Jul 14, 2022, 3:44 PM UTC

suchow wrote: post #275

j0hnyl wrote: post #229

Earlier quoted context omitted.

I think they can. The thing is the corporate landlords would rather have their high rises sit empty than rent the units at reasonable rates.

Do you know what would motivate this behavior? Naively, any rent is more than zero rent, so why let a unit sit empty?

IIRC Sometimes some of these units are tied to a mortgage. Renting it at a reasonable price could make the price of the unit to drop making the money lender wanting to renegotiate the mortgage contract.