The Middle Class Can't Afford to Live in Cities Anymore
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Things are more reasonably priced here, but probably still higher than their intrinsic value. However, at least we can afford them without mortgaging our (and our kids') future.
The truth is that this isn't a situation the government has shown any ability to solve for. There are a myriad of reasons, but ultimately my feeling is that federal housing policy is deeply flawed.
Inevitably, by necessity, the solution to this mess will come from all those in the middle class who've been forced to find another way. Our voting with our feet will shape the next ten to twenty years in ways which are hard to predict. One likely outcome is that big cities will not be able to maintain their current housing price structures. A tipping point will come. You can't build a viable local economy only on the top and bottom of the income spectrum. You need a robust middle class. Otherwise the absence of the middle class creates a vacuum, and conditions for an implosion into that vacuum.
We wish we had a train system in many cities that allowed the middle class to live 40-60 minutes away from their jobs.
Ultimately however the main problem is wealth inequality. If median income had increased with GDP since 1980, instead of all gains going to the 0.01%, you would be able to afford to live in the suburbs of San Diego.
The one and only fix is more houses. That's it. Any other solution is just picking winners and losers different ways. But no matter which way you pick the same number of people win and the same number lose.
Unfortunately, it's not that simple. The heart of the problem in many parts of the country is that we fund our schools with property taxes.
Hence, a cycle of better schools and increased demand in concentrated areas, which causes the supply-demand imbalance and price increases. Compounding this is the fact that people in such areas actively block "higher density" housing, which naturally means fewer houses per acre.
Building more houses would help to a limited extent, but the shortage would still exist and resistance is stout.
Hence, the shortage of housing is just a symptom of how we fund education, which is the real problem.
>Inequality is not the problem
Inequality absolutely enters here because if wealth/income were more evenly distributed, then funding for schools would be more evenly distributed, thus alleviating concentrated housing demand in small areas with better schools and driving up prices.
And, what's the history? Were these schools neglected for years, then the state recently started pouring in money?
I mean, maybe there are some exceptions (perhaps partially gentrified cities where some tax base is moving back into cities at inflated prices?), but these would generally be outliers. Since wealthier people have fled most major cities for the burbs, the tax base and educational investments have generally followed them. You see this over and over again in communities throughout the country.
For example:
http://www.npr.org/2016/04/18/474256366/why-americas-schools...
Cambridge (expensive city) $27,569 per pupil
Concord (expensive suburb) $17,517 per pupil
http://profiles.doe.mass.edu/state_report/ppx.aspx
Rankings
Cambridge Ringe and Latin was 214 out of 340
Concord Carlisle High was 27 out of 340
https://www.schooldigger.com/go/MA/schoolrank.aspx?level=3
Not cherry-picked data.
A lot of the difference is that cities, even expensive ones, are cities. A lot more diverse student body. A lot more students with problems at home. More disruption, etc. You can spend more money but the average student in the city school almost certainly has less parental involvement and less of a home environment that's conducive to learning than in the tony suburb.
The linked article (and decades of debate) notwithstanding, it's also hard to really correlate spending per pupil with educational outcomes past a certain point--especially as measured on standardized tests. Poorer cities do spend less. Two Lawrence high schools have the worst test results in Massachusetts. But its spending, $14,475 per pupil, is still only a bit less than Concord.
Definitely does in my city. Teacher pay's also substantially higher in the inner city schools. Most teachers still don't want to work there because they're stuck in a seemingly-inescapable poverty-and-culture-driven "bad homes -> bad students -> burnt-out and bitter faculty" rut, which makes them a discouraging, abusive, and dangerous hell for faculty and students alike.
Source: my wife and probably half my circle of friends are teachers.
[EDIT] in fact, some of the better suburban schools pay worse than the so-so suburban schools, let alone the high-paying inner city ones, because they can. Good teachers will still work there because the environment is nicer and more rewarding (that is, the students are way easier to teach, and the community tends to be supportive)
If Concord schools had to take any number of first generation impoverished immigrants with poor English language skills, their test scores would implode. That doesn't happen, because working class immigrants don't buy the $800K homes in Concord.
Despite having significant growth opportunity San Fran is already twice as dense as Seattle. Therefore Seattle has room for explosive housing growth. It would need more changes than just housing of course. But that's to be expected and totally doable.
Cities are huge economic multipliers. We don't need more cities yet. The ones we have are perfectly great! We need to more efficiently use what we already have.
This housing crisis isn't affecting just "top tier" cities. It's not just New York and San Fran. It's Seattle. It's Denver, Austin, and Portland. It's even Nashville!
Every city, top to bottom, needs to be doing more. And they need to start now as the longer they wait the more expensive the infrastructure adjustments become.
So long as you also build all the transportation, schooling, utility, and other infrastructure needed to support it.
Additional housing will result in a larger tax base which will automatically cover additional schooling needs.
I am hopeful for autonomous app hailed buses, but there's definitely a big chance it doesn't all work out that way, and even then there is clearly still a physical limit on how much existing road infrastructure can handle.
Wat? That is literally the opposite of reality.
The problem is cities are TOO POPULAR. Cities so successful that only the rich can afford to live in them! Increased property values, more property tax revenue, higher resident earnings and spendings. Cities aren't being decimated. Cities are so economically successful that poor people are being forced out so more rich people can move in!
The article, titled "The Middle Class Can't Afford to Live in Cities Anymore" is about people earning $50,000 to $125,000 who can't afford housing in cities. It's not about rural or rust belt communities with no jobs. Housing is plenty cheap in those areas. They just lack the jobs to go with it. A very real but very different problem.
Our modern economy wants to centralize in cities, and not doing so is leaving free lunch on the table. Also keep in mind that more people in cities = cheaper suburbs for those who prefer it.
Increased centralization in cities is a bit of a problem. But cities are such an economic multiplier that it's difficult not to. That's a tougher nut to crack.
It's easy to say and hard to do, but concerns like a good neighborhood or decent commute when looking for living arrangements in the cities is definitely not as common in Europe as it is in the US.
Or of course you go to rust belt equivalent communities. Northern Spain. Southern Italy. Very cheap, beautiful even, housing for no money whatsoever. And not a chance in hell of finding a job there.
http://www.globalpropertyguide.com/most-expensive-cities
You will find that European cities are very expensive to buy in and equally bad to rent in. Paris, Geneva, London, Helsinki, Stockholm, etc... all suffer from the exact same issues we're now seeing in American cities.
You could argue that the make-up of those cities are superior, as their suburbs are much more compact and urban connected with much better public transportation. This coupled with a culture that is much more ok with living in small spaces helps the middle class immensely.
In terms of a priced out middle class, however, the United States is really just catching up to the rest of the world.
The problem of income inequality is one and the same as the housing crisis - ie, the wealth gap is nearly entirely explained by real estate.
The problem is that the 0.01% -- households worth more than ~$100M -- have received almost all the wealth gains since 1980. That's not just real estate -- it has to do with globalization as well as tax and policy decision.
So the very rich have gotten much richer, while median incomes (I.e. middle class incomes) have not increased.
See Fig 1 of this paper: https://gabriel-zucman.eu/files/SaezZucman2014.pdf
It's not surprising that those who started with the most, also got the most gains.
1) Reagan fired the air traffic controllers in 1981.
2) This set off a wave of anti-union action - http://www.alternet.org/story/154595/how_ronald_reagan_broke... - causing the great decoupling of wages and productivity: https://upload.wikimedia.org/wikipedia/commons/4/45/Producti...
3) ...which caused staggering levels of wealth inequality: http://www.bankers-anonymous.com/wp-content/uploads/2015/04/...
4) And all that accumulated wealth ended up being lent back in the form of loans (e.g. student loans), mortgages as well as bidding up the price of real estate which your grandma - a 'boomer' profited a small amount from - which is why this is actually all her fault.
Since the demand for such cities is quite high--a large number of middle class voters would like to live in one--would a mobilization of political will enable us to change to situation somewhat, at least over the medium to long term?
Yes, they will be living in condos and apartments. You can have a large detached home, or live in a city. You can't have both.
You don't come across as negatively "privileged", but perhaps if you can afford to send your kids to college, and plan for retirement, and have a rainy day fund to boot, you might consider yourself blessed compared to the situation many people find themselves in. I'm well enough off, but I'd give an arm to be in your position. :)
This is true for a very small percentage of the population.
If you're not rich you might as well say fuck it, relax, and be poor. The middle class has to pay for _both_ the profits of the rich and the welfare of the poor, while not being able to afford a decent life for a family despite working hard and doing everything right. It is a totally exploited class.
We have lived for more than a decade with four children in a house with fewer finished square feet of floor space. I'm curious about what "good neighborhood" means here, because my children can walk or bicycle all over the place, without fear of mishap, and the local public schools here draw people from all over the country. "Reasonable commute" is also a term I'd like to understand better in this context. How tied to location is the employment you each have, if you are able to move out of state?
I have to think that it's possible for middle-class people like my family (at a lower income level, currently, than what you self-report) to live in cities, because we do. Most of our work happens to be in outer-ring suburbs, so "reasonable commute" puts us there, but other people with work nearer into the center of the metropolitan area can live affordably further in.
Disclosure: we live in an other ring suburb of Minneapolis, just outside the beltway freeway around the Twin Cities, and barely within reach of the bus system. My wife and my third son bike-commute often, year-round.
I was in Barcelona recently (yay NIPS!) and Barcelona is smaller than SF (36 sq mi) and has nearly twice the population! Everywhere you see are 6-floor buildings, with the bottom reserved for shops and people living above them. It is so walkable, with great (and reliable) public transportation. We kept thinking: why can't SF be more like BCN?
1. Earthquakes.
2. City planning policies over the years (or lack thereof).
It'd sure be nice to be able to clear a few blocks at a time and start over with fresh buildings, but it's more a matter of changing wheels on a bus while it's full of people driving down the street.
And yet Tokyo exists.
Felt like nothing more than a freight truck passing by.
A large portion of the housing in San Francisco dates to that era. However, rather than learn from the mistakes made pre-1906, San Francisco just rebuilt things exactly the way they were before. Look how much damage the 1989 earthquake caused, and that was a sub 7.0 earthquake. Another major earthquake would result in similar devastation to the 1906 earthquake.
The best part is the NIMBYs who refuse to allow earthquake deathtraps to be destroyed for more modern buildings. They've become so complacent and ignorant to the reality of a major earthquake, that they feel the character of the city is more important than the lives of the people in it.
Because 'Murrica. As a native Russian, this has always puzzled and bewildered me, too.
I wish more of America were like Barcelona, including SF. Regulations tend to prohibit dense walkable construction though. I don't mean NIMBY protests per se. Existing city regulations tend to require more parking spaces and setbacks than old cities provided.
Not to mention prohibitions on having shops and housing in the same zones that most modern cities now have.
This shows that a good chunk of Manhattan couldn't be built today: http://www.nytimes.com/glogin?URI=http%3A%2F%2Fwww.nytimes.c...
The North American status quo is weird: it is illegal to build dense, walkable, aesthetically pleasing neighbourhoods.
Because you'd have to demolish acres and acres of 100+ year-old architecture (generally considered to be among the planet's most distinctive) to make it that way.
And even if we did -- it wouldn't look anything like Barcelona (and its fabulously integrated 100 year-old architecture and street grid), either. Most likely, I betcha, it would end up looking like a pepped up, West Coast version of this place:
https://en.wikipedia.org/wiki/Battery_Park_City
Which I'm sure would suit many of the "Who cares about historic architecture, as long as I can get a shot at a $2400 studio!" advocates here just fine.
As opposed to the status quo, which suits many of the "Who cares about the middle class, as long as we can preserve all of the 100+ year old architecture" advocates just fine.
Let's just continue the wholesale replacement of the people and culture that gave rise to it in the first place.
The point is that it used to be an affordable neighborhood. And the city in general used to be more or less affordable for the middle class, also -- independent of the ethnic background of its inhabitants. And that changes (including full-scale transformations of neighborhoods) which used to take generations to transpire now happen in the course of 10 years or so.
Just because change has happened before doesn't mean that all "change" is equivalent (or even "natural").
"all of" being a straw man, of course.
SF's architecture is nice for being in the US. And the interesting parts are actually quite limited. The Sunset and the Richmond have pretty much zero architectural value, for instance.
It's not practical to live in a city and have a pole barn with a station for each different hobby, but you can still do a lot and make it work. Sometimes it ends up being pretty expensive, e.g. Keeping an extra car in the city could be ~$300/mo in the case of SF, but car storage around say Laguna Seca can be quite a bit cheaper.
I feel the same. I grew up in Europe and I'll add to that that generally speaking, apartment sizes are much bigger in SF (and, basically, western US) than anywhere I've lived before. I was recently in NY and apt sizes there remind me Hong Kong actually (well, I exaggerate a bit). Funny thing too is that when you cross the border into Vancouver from Seattle, you immediately revert back to Europe size apts!
"I asked a passing teamster, for want of something better to say, what land was worth there. He pointed to some cows grazing so far off that they looked like mice, and said, 'I don't know exactly, but there is a man over there who will sell some land for a thousand dollars an acre.' Like a flash it came over me that there was the reason of advancing poverty with advancing wealth. With the growth of population, land grows in value, and the men who work it must pay more for the privilege." -- Henry George
Listing prices are pretty useless. Better to look at the prices homes actually sell for.
Do you have kids? Because this glib reaction signals that you don't, or you'd be aware that the areas you are touting as affordable have terrible public schools. That's why they're relatively cheap. That, and the hour-plus commutes (each way) to where most middle-class jobs are.
There are affordable parts of Long Island and Connecticut with great public public schools less than an hour from Manhattan by train.
We've grown accustomed to overporting our post-war suburban archetype of what a "middle class" family "deserves," i.e. lots of bedrooms, garages and lawn space, while diminishing previously (and still!) common practices like having roommates when young, not owning a car, et cetera.
When a good chunk of those years had interest rates in the 10%+ range, and when the years that were lower than 10% ended with "The Housing Bubble Pop" and "Great Recession", that 6% compounded growth is actually kinda awful.
In any case, compound growth is the center of most economies. Being the owner of things entitles you to profits, be it in stocks, bonds, or real estate.
The "buying on debt" depends on the rate that you got in at. If you're complaining that people in the 1970s were able to get 15% mortgages to earn lol 6% on Real Estate, then I don't think you fully appreciate the history of Stagflation and the 80s bond market.
---------
All in all, housing prices have rose because interest rates have fallen. More people can afford a house when mortgages are at 4% instead of at 15%, and the price of homes go up to compensate.
Unless rates drop dramatically in a short-period of time (like in 2012), refinancing opportunities are rare. From the 1980s, you wouldn't have had a refinance opportunity until the mid 90s.
Nonsense. I'm a New Yorker. You literally CAN'T get to DOWNTOWN Manhattan from any part of Connecticut in under an hour. The first metro-north stop in CT (Greenwich, which, BTW, is NOT affordable to live near) is over 40 minutes from Grand Central at the best of times. And then you have to change to the subway to get downtown. Nuh-uh. An hour each way is not happening.
I'm not sure what your point was about suburban deserts (in the sense of things deserved,) but the point of the article is that even with things like not owning a car priced in, housing (in cities with jobs) is still unobtanium for people in the hole between section 8 and tech salaries, who didn't already buy their homes when they were cheaper. Editorializing a bit, this sucks in the long-term. The upper east side of manhattan west of park, which was expensive before "gentrification" was a word, shows what this leads to: a limestone-clad desert made of vertical money and not much else.
I live in Midtown. This time of year, I can't get downtown in less than an hour :).
It's reasonable for a productive person to demand any two of: space, a great location and disposable income.
My household of two chooses to enjoy our neck of Manhattan. We make do with like 400 square feet. If we had kids we would need to live in a city we get to enjoy less frequently or commute from the suburbs. Neither is particularly appealing to me, but I've heard kids are nice.
> "gentrification"...leads to a limestone-clad desert made of vertical money and not much else
Gentrification can lead to density in addition to urban deserts. Ironically, activists seem to prefer restricting housing supply. That means the latter.
Apparently you know your comment wasn't too truthful which is why you backed off with "I live in Midtown [..even so..] I can't get downtown in less than an hour". So, what exactly was the point of your comment?
Also note: household of 2 is not a household when talking about middle-class income. Why? Well, household of 2 adults is basically the best case scenario financially (both have jobs without additional dependents).
As a anecdote/data point: even making >300+k with both parents working still is a drag in NYC when you have 2 kids, regardless of what BS you hear online.
I've lived in Stamford. I would not want to live there again. Between ample space, proximity and disposable cash, I chose the latter two. If I wanted more space, Connecticut offers a fair deal for saving money or being close to the train station.
> you know your comment wasn't too truthful
Not sure why you went straight for the deep end. It's the holidays. I'm budgeting 45 minutes to the Upper West Side. The smiley implied facetiousness.
It's 50 minutes from Grand Central to Stamford [1]. That's comparable to the average American's 25-minute commute [2]. My core and recurring point is simply that cities are defined by density. If you want lots of space, you're fighting the current.
[1] http://as0.mta.info/mnr/schedules/sched_form.cfm
[2] http://www.usatoday.com/story/news/nation/2013/03/05/america...
Your point of "choose 2" isn't anything more than a compromise you've made. That is, not something that is "correct" but a compromise you've settled on. I'm happy for you to settle on that as a baseline for your life, but it irks me to hear you spout it as a "truth".
Cities are defined by density. What makes them valuable is density. Density is people per unit of space. You can do some things going vertically, but there are costs and limits associated with that, both practical and political.
Lots of people in high density means low average space per person. If you want more space it will be expensive and eat into your cash. If you want to keep that cash, you don't have options in a high-density city.
Yes, you can have all three with lots of cash. But you can't have a city with most having lots of space, because that means they live in low density and are no longer in a city.
"People's lives are too good, we need to make them worse."
What's your angle? What do you gain from advocating against mobility and personal space? Are you upset because you didn't have these things, and don't want "undeserving" people to have them? Or do you just want us all to live in worse conditions for the fun of it? I genuinely can't understand what moves someone to push for "people should not have their own bedrooms or time-efficient commutes."
What works in the suburbs isn't sustainable in cities. Suburbia is built for personal spaces. It's terrible, however, at supporting the rich social fabrics densely-packed humans spontaneously weave. (There's also the problems of commute and it's environmental impact.)
City-centre richness is a direct product of density. If everyone gets large, personal spaces you're back to suburbia and all its disadvantages.
Living in a city means accepting less personal space in exchange for the benefits of density. The only alternative is to have fewer people with more personal space, which means rationing or auctioning off that limited housing as well as a less "city-like" urban core.
This is true on the x-y plane but not the z-axis. We can have substantially more sqft available per sqft desired in the same land footprint by building up, which is currently heavily regulated or outright illegal.
It's better than yards and boulevards, but a building of three-bedroom apartments to the edge of space will have a different human dynamic from one with mostly one-bedrooms.
You can get your human dynamic just fine on sidewalks, cafes, parks, etc. It doesn't need to be in-building. And even ~70 stories by elevator is still only a few minutes, nothing like the hour-plus train rides middle-class people in cities currently need to endure.
More density means fewer [EDIT: more] people within walking distance of each café, park and restaurant. That, in turn, affects how many of them there are and how eclectic they can be.
Density is people over space. If you give each person more space, you reduce density. This can't be avoided.
> nothing like the hour-plus train rides middle-class people in cities currently need to endure
They don't need to endure it. Stamford, CT and Rochester or Port Jefferson, NY are nice cities with middling densities.
But many people don't want that. They want restaurants and nightclubs and parks with rotating art installations that only emerge and make sense when you pack people together.
Sure, you can put one or two large units in the mix without screwing things up. But not a lot, not for everyone. Else you end up with urban deserts.
You really think a neighborhood of 70-story buildings can sustain these things as long as people share bedrooms, but can't the instant that children and young adults have their own doors to close?
>More density means fewer people within walking distance of each café, park and restaurant.
Vertical distance costs almost nothing in terms of time, given modern elevators and scheduling. I'll skip the cafe because it's a 40 minute walk instead of 10. You'd really skip the cafe because it's 20 floors down instead of 5? That's, like, one minute on a really bad day.
>If you give each person more space, you reduce density.
Well sure, but the advantages of density really come from compactness in time/ease of transportation rather than space. It doesn't matter that the restaurant is far away from its customers on the vertical axis, because elevators are fast.
If you mandated one bedroom per person you'd have to expel 31 to 38% of the population or increase the number of bedrooms by 45 to 60%.
Manhattan's 33.6 square miles [5] are populated with 70,826 people per square mile. If we go the culling-people route, that drops to 44,000 to 49,000 people per square mile. That's the population density of West New York, in New Jersey [6]. Manhattan and West New York are radically different places.
If we go the building-units route, consider that Manhattan gained 13,189 units between 2011 and 2014, i.e. 4,400 a year [1; Table 2]. To build the 500,000 to 600,000 bedrooms we need you'd need to make 415,000 to 500,000 units, i.e. a century of construction. (If you built only three bedrooms, you'd cut that time down to 167,000 to 200,000 units, i.e. a mere 38 to 45 years.) To build them in 20 years, you'd need to increase construction by 4.7 to 5.7x (90% to 2.3x if only 3BR), and that's ignoring any additional infrastructure that new population may need as well as population growth.
Cities are a product of density. If you try to make a city with suburban-sized personal spaces, you end up with neither city nor suburbia. Building up is better than sideways, always, but we shouldn't delude ourselves regarding realistic sets of trade-offs.
[1] https://www1.nyc.gov/assets/hpd/downloads/pdf/2014-HVS-initi... Page 1
[2] http://www1.nyc.gov/assets/planning/download/pdf/data-maps/n... Table 1
[3] https://en.wikipedia.org/wiki/Demographics_of_Manhattan
[4] http://furmancenter.org/files/FurmanCenter_FactBrief_RentSta... Table F
Of course, the proportion of married couples could be much lower in Manhattan, and it's not necessarily the same 43%, but you get the idea.
More to the point I'm very interested what tradeoffs you think are worth literally never having the chance to be alone in a room. Without a shadow of a doubt I'd kill myself, and I'd never dream of brining a child into that miserable existence.
[0] https://censusreporter.org/profiles/16000US3651000-new-york-...
50% of the Manhattan population lives alone, the same as the fraction that has never married [1]. So yes, what you outlined is approximately what's going on. (Just 12% of New Yorkers in rent-regulated apartments had more than 1 person per room; 4.4% more than 1.5 [2].)
The status quo isn't crowded per se. It's just crowded relative to suburbia. The point of my illustration was that small tweaks to density, e.g. one instead of one and a half bedrooms per person, quickly spiral at the scales and within the constraints of a city.
[1] http://nypost.com/2010/01/05/all-the-single-people-in-manhat...
[2] https://www1.nyc.gov/assets/hpd/downloads/pdf/2014-HVS-initi... Table 19
The K-12 school situation doesn't make them not affordable. It makes them less desirable, but cddotdotslash already pointed out that it's the desirable parts of the city that are unaffordable.
Sooner or later, society will have to realize that white/middle class flight is a direct cause of terrible public schools; and that by reversing the trend these schools will become less terrible.
https://spottedtoad.wordpress.com/2016/06/10/middle-class-ki...
That's the thing about big cities, there's usually a huge variety of housing at all price points - with a variety of pros and cons for sure, but the lack of housing at a variety of prices is typically not an issue.
Hahaha, I suppose if you're willing to live in near skid-row conditions.
Thousand Oaks would reduce house costs to 400-600k, but add 20-30 mins to an already hour-long drive. Forget public transit.
If you don't need to go to SM/Venice/West LA, then going south might be better. Orange County has a lot to offer and probably a bit cheaper.
If you are ok with Condos/Townhomes, either direction, 2-3 br condo can be had for less than 400k, sometimes less than 300k.
Most condos on the west side are more like 600-900k and above, so the drive can save you 50%, but it really sucks. (Did the drive for 6 years.)
http://www.realtor.com/realestateandhomes-search/Los-Angeles... https://www.zillow.com/mortgage-calculator/house-affordabili...
There's also has been a homeless explosion in the last three years. http://www.cnn.com/2015/09/22/us/los-angeles-homelessness/
As mentioned, our rent went up by 7% this year, and has gone up in the area 30-40% in the last 4 years.
If you want sub 300k in a safe area with shorter commute, then you have to stick to condos. If you have to have a house, commute is required. Valencia, Santa Clarita, Sylmar, all have houses in $300k or less.
Homeless explosion has as much to do with inadequate mental health care as any economic situation. Homelessness is such a complex topic that no comment on a thread could ever do it justice. Try talking a chronically homeless person into accepting a free apartment - you'd be surprised at the answer and concerns.
Otherwise, there is a glut of condos almost anywhere you look, if you're okay with living in a condo and paying HOA dues every month - which is the problem with condos, the HOA dues can easily take something affordable and push it to the edge of affordability or beyond.
I've been looking recently, speaking from current experience.
If you take a look at the top 40 or so entries here https://en.wikipedia.org/wiki/List_of_Metropolitan_Statistic... you will be able to pick out places with nice economies and reasonable housing costs.
Move to any major Texan city, any major Floridian city -- really any city in "The South" -- and the situation is much different. There are tons of great properties for unsubsidized, lower class purchasers. Seriously, zillow downtown Nashville TN. You can find great deals for the poorest amongst us.
People in (sorry to say) liberal cities have such warped, contradictory views of housing that it blows my mind. "We need more transport, we need more subsidies, we need X!" No, what you need to do is to let go. Let housing take care of itself. All of these schemes have contributed and will continue to contribute to the eviction of the middle and working class tenants.
Yeah, Charlotte, Tampa, Atlanta, Indianapolis, Salt Lake City, and Phoenix are a lot cheaper. But that's in large part because they're not SF or NYC. :) First-class cities can literally provide 10x-20x the value for a lot of folks.
I have no dog in this fight; I lived in Atlanta for ten years and now live in a small-medium college town. Being self-employed for a long time now, I have no intention of moving to SF or NYC. But I can certainly see why someone would.
That said, the US has a unique advantage here compared to most of the world, "developed" and otherwise; it is very decentralised economically. In the grand scheme of things here, life in Charlotte just isn't _that_ different from NYC. In many other economies, a sizable chunk of the GDP is parked in the capital and maybe one or two other top-tier cities, and the difference between life there and life anywhere else—anywhere else at all, even another fairly large city—is considerable. In my native USSR—and as I understand it, its descendant Russia—there a huge chasm between "Moscow" and "not Moscow", even though there are dozens of other sizable cities in Russia. The Soviet economy was exceptionally geographically centralised, so makes for a very extreme example, but I think you get my point.
My homecity is now over 600k people, but it's really just a network of highways and avenues/parkways connecting them all. Public transit is underfunded, and only the poorest of the poor use it until they can buy a car. Buying a car is simply a necessity, like a roof over your head.
Maybe the freedom of not being trapped in a car to get anywhere interesting costs more. ¯\_(ツ)_/¯
Perhaps it does. That is little consolation to the poor. All of whom have cars.
Society and government exist to help us citizens coordinate our efforts to solve problems bigger than any of us. Building public transit and forming density-friendly zoning rules are what we should all be doing together.
Zoning protects incumbents -- always. Incumbents are the reason more density is not being built in places like SF.
Every solution you've presented has been done, is being done, and will always be done until it becomes politically unpopular to do so. I don't see how doing it again will solve anything.
I have been assisting architect Eugene Lew with a comprehensive and audacious solution to this problem. If you are interested in reading a draft version of his white paper, DM me on https://twitter.com/jamiepitts.
The concept is tailor-made for the west districts of SF but can be applied to any city.
It combines finance, architecture, land-creation, community involvement, and propagation, and the output is a nonsubsidized 3BDR, 2BA home for households with incomes between $100,000 and $150,000. There are 15 homes in a six story elevator building, and the goal is to build hundreds of them across SF.
I think the solution is not trying to cram more units into a small area. Manhattan has done that for decades, and it's still not enough to balance supply and demand. Rather, it's to encourage business development and residential living elsewhere, either nearby or far away. We're seeing that with Oakland and northern NJ but there are many more opportunities to expand this to other areas of the country. A lot of credit goes to southern states which encouraged (through tax breaks and other incentives) heavy industry to set up shop in smaller cities and rural areas. What will it take Google, GE, or Microsoft to move a big chunk of their respective operations away from San Francisco, Boston, and Seattle?
It's a chicken and egg problem: companies don't want to invest in cities where there aren't a lot of qualified workers, and workers don't want to move to cities where there aren't a lot of jobs. Furthermore, the most competitive workers tend to move to the cities you mentioned, so companies located in those cities can stay where they are and enjoy having the best workers come to them.
Consider the Sacramento area: it's about 2 hours from Silicon Valley by car, with significantly cheaper housing, and plenty of well-connected people because Sacramento is the state capital. Why doesn't that area have a booming tech economy? Because the most competitive tech workers from Sacramento have already moved to the Bay Area. Bay Area companies don't need to open offices in Sacramento to attract those workers.
The simple answer is that they would not benefit by doing that. They can just sit tight in Silicon Valley, Seattle, and New York while the best talent comes to them.
I figure if we'd eliminate the latter, we'd take care of a lot of the former.
In NYC, we have recently seen rents reduce due to new housing supply coming on the market.
"Howdy, neighbor! I'm gonna build 70'-high sludge containment tower on these vacant lots I just bought next to your property. Got a problem with that?"
Of course you would. Everyone is a NIMBYist, to dome degree or another. It's just a question of degree.
I live nearish to Salt Lake City (whose metro pop. is less than a quarter of Boston's), have tons of software job opportunities, have a 17-20 min commute, and bought a 2k sqft house on 0.19 acres for less than 200k.
Big cities are crowded. They have their advantages, but even if they weren't overpriced, I'd probably still prefer my elbow room.
Utah's always had a strong software industry, dating back to WordPerfect and Novell. Lots of jobs are in SLC of course, but the rest of Utah Valley has even more, e.g. Lehi and Thanksgiving Point. Known as "Silicon Slopes" (https://en.wikipedia.org/wiki/Silicon_Slopes)
Great place for families or outdoorsy people.
I see millennials just a few years out of college buying houses in Detroit for example. Just not downtown or in Corktown. Similarly I've got friends with houses in Chicago, Cleveland and Minneapolis. I've got upper middle class friends who can't afford to buy a house anywhere in Silicon Valley.
(Although housing in the epicenter of these cities' tech boomlets can be absurd compared to the rest of the city. This new construction in Pittsburgh's East End - http://www.zillow.com/b/bakery-living-pittsburgh-pa-63CwP3/ - charges the same for 1 bed that I paid for a 3-bedroom townhouse in a solid neighborhood ~1 mile away 2 years ago.)
That said, other industries are geographically concentrated as well. If you have your heart set on working in the oil business, you probably shouldn't set your sights on living in Boston.
It's not just that different industries have their hubs - media, design, finance in NYC, entertainment in LA, tech in SF. A whole ecosystem of supporting firms grows around these companies. So the most influential and prestigious law, accounting, and consulting firms tend to cluster in these cities too.
There also are a lot of people who don't necessarily want to spend their entire lives in, say, NYC but think it will be a good career move to get a prestigious name on their resume before going somewhere else.
At this point I think there's kind of a chicken and egg situation where a lot of ambitious, talented people flock to major cities because firms are there, and firms stay planted in these cities because so many talented, ambitious people are flocking there.
Fair enough, but mid sized cities have jobs for plumbers, electricians, government employees, secretaries, marketing people, accountants, college professors, construction, biologists, vetrenarians, etc.
The title, "The Middle Class Can't Afford to Live in Cities Anymore" is absurd.
Thus they either have to deal with periodic un- or under-employment, or manage the risk by building a cash cushion, either of which means a less affluent lifestyle.
There are plenty of suburbs within a 10-20 minute driving distance from the city. Also, businesses operate in those surrounding suburbs.
I like mid sized cities. Not too large, not too small, but just right.
I pay around $1600 monthly for a $227,000 house in Austin, so the housing cost would be $19,200 / $41,000 or _46%_ which is absolutely not 'affordable.'
If someone making the median income in a city can afford a median house with 21% of their gross income, yes, I deem that "affordable."
To go back to my example, the family making $41k net annually is paying $10,800 (ish) annually in mortgage costs. They pay an additional $4,781 in property tax annually. That leaves $25,419 annually or $2,100 monthly for other costs and savings.
My example makes plenty of assumptions that won't necessarily hold (after all, I'm assuming averages here). Notably, I'm assuming a 20% down payment and excellent credit. And no, that's not a lavish lifestyle. But it's well within the realm of "affordable" for an average person.
I'll also note that $228,000 is the median price, but a search on Zillow shows >1500 listings for less than $150,000. I saw one listing for 3bd/2ba at $135k within the loop. near decent schools and within 20 minutes driving distance of downtown, the USAA and Valero corporate campuses and the UTHSCA medical center, all major employers.
I don't really see what your example has to do with my point. Yes, Austin is more expensive than SATX. Yes, someone making $51k should not pay $1600 a month in housing cost. But you're making my point for me—housing costs in medium-large cities are not necessarily out of whack average incomes in all such cities, just some markets (like Austin).
https://www.bloomberg.com/news/articles/2014-07-17/housings-...
I was using it as a starting point.
Is it true of LA? That also sounds wrong to me.
I just moved out of a place in Studio City, paying $1200 for a small one-bedroom apartment. It's listed now for $1600, and I'd bet on it filling within 10 days.
So that's a 1/3 increase in rent I was able to avoid by staying in one place for a long while, but if I'd been moving around it would have cost much more over the years.
In the far (semi-rural) reaches of Sacramento now, and happier for it!
Is that true of LA? It's only the case if there's no reasonable neighborhood within the boundaries of LA you could move to after an untenable rent increase in your current neighborhood.
For instance: it's obviously not the case that middle class families are priced out of the Chicago market. Chicago is full of neighborhoods full of hours and townhomes and three-flats that span pretty much the whole price spectrum. On the other hand: some neighborhoods that were pretty reasonable 10 years ago (Roscoe Village, or Bucktown) are now so expensive that their demography is changing. That doesn't mean Chicago is pricing out middle class families; it means Bucktown is.
There are certainly areas of LA at least as big as the total area of SF where middle class families can not afford to live. There are also areas at least as big as the total area of SF where lower-middle class families are the vast majority of residents.
The cities are just too different to make a meaningful comparison in my opinion.
What's Bayview like in San Francisco these days?
The better question is do middle class families have to live as far away from their jobs in LA as they do in SF, and the answer to that question is increasingly "yes."
Median household income for city of LA is ~$60k. Without detailing the numbers, maybe if you're really liberal with mortgage qualification you get a $450k home at that income (house or condo). In a broad Redfin search of the Valley/LA Basin and a bit beyond to the east/south (this includes many cities outside of LA), you have:
Total homes for sale: 4,720 <$450k: 873 (18%) In Safe Neighborhoods: 294 (6%) (I used my own definition of safe, but it's very liberal and includes many places where walking around after dark alone would not be advised, but it's an urban area after all so that's understandable)
Btw, and this is where people say you're not entitled to something, but if you are just talking about single family homes (LA is very single family home-focused) in a safe hood for <450k the number of availabilities drops to 51 homes (that's 1% of inventory).
Lots of other nuances here, but just a broad brushstroke look at the market.
The situation is that a vast expanse of the (very large) city of LA, and key enclaves like West Hollywood and Santa Monica (not formally part of LA, but surrounded by it) has had large and steady price increases for the past ~60 months straight. Renters have been priced out of one neighborhood after another.
It has caused a huge upheaval as people who had not noticed the pace of change have had to move to distant neighborhoods, or out of the area entirely. You see a lot more homeless, and there is a political struggle about people living in mobile homes parked at the edges of parks, etc. This upheaval is a hot issue.
But (coming to the point) it is still, barely, possible for middle class people to find homes in LA city. But you have to pay a lot more (say, 400k), and/or accept some living conditions that are marginal. When middle class Anglo families are seriously considering moving to Boyle Heights condos...it's a new thing.
I don't have time just now, but looking at real estate listings for Cypress Park might be informative. This is a tough neighborhood with significant long standing gang activity. Not South LA (aka "south central"), but close. Example: https://www.redfin.com/CA/Los-Angeles/3608-Arroyo-Seco-Ave-9... (sold for 360k last year).
450k for a 2+1, 744 sq. ft. -- https://www.redfin.com/CA/Los-Angeles/3618-Arroyo-Seco-Ave-9...
In a neighborhood with regular gang related homicides -- e.g., https://www.theeastsiderla.com/2016/08/one-dead-in-cypress-p...
Personally I'm into music. Composing, playing shows, going to the symphony, the opera, the ballet. Sure, I could leave Toronto, except now I'm in the middle of nowhere where there are no jobs and no culture. Now what?
I'm sure it's similar for others in the US.
There are huge, huge affordability problems with Vancouver and Toronto, but they're hardly your only choices.
I'm not sure about the music scene but there are a wide variety of both English and French language theatre companies. NAC, GCTC, La Nouvelle Scene, etc. I'm sure the situation is similar for Opera and Ballet.
Personally, I think that a metro/subway system is a good marker of whether or not a place is dense enough to be considered a city. By that metric, the US only has a handful of cities: Atlanta, Baltimore, Boston, Chicago, Cleveland (?!), DC, Los Angeles, Miami, NYC, Philadelphia, San Francisco, and San Juan Puerto Rico (?!).
If you look at a pure density metric of 10k people per square mile at the center of a metro area you end up with a subset: Boston, Chicago, DC, Los Angeles, Miami, NYC, Philadelphia, San Francisco. The City of LA itself has a density of only 8k per square mile but 27 of the surrounding municipalities have a density above the threshold so I included it in the list. Providence, RI happens to also be particularly dense although just below my arbitrary cut-off. There are a few incorporated places throughout the US which are small enough to meet the density threshold but are part of a larger metropolitan area which do not.
Arguments could be made for Atlanta, Baltimore, Cleveland, or San Juan based on the first criterion. Places like Houston, Austin, Seattle, Dallas, Lousiville, Salt Lake City, etc. might be considered by some to be cities. Based on my time there, I would say that Seattle is on the cusp of becoming a city and that this may apply to a lot of other places throughout the US. If the US was a lot less car-centric it might have a lot more cities (based on both criteria).
I dislike density and can't stand not having lots and lots of space. I love the look and feel of sprawl, and I want more of it... you couldn't pay me to live in an urban environment.
Crowded cities feel like something out of the past to me. Like, my great-grandparents lived in a crowded city when they first came to this country, and every subsequent generation has moved farther and farther out into the burbs. Moving to a city would feel like moving to 1901 to me.
Anecdotal story: I live in a decent but not super nice part of Seattle and we had a house a few blocks away sell for 750k, which seems insane as everything else in the area goes for 400-500k and historically has basically been the ghetto. I could not imagine trying to get into this market, I would be living 6 miles down the road.
Will be interesting to see how prices are impacted once the fed raises rates. Borrowing will be more expensive and should have a depressing effect on home prices.
People will always pay most of their money in rents, everyone needs a place to live [and wants it to be nice].
Low interest rates are allowing people to take 20-40 years mortgages, for huge total sums of money.
If rates were higher, the duration and sum would be forced to be lower. It's basic maths.
Upper middle class == ~ 170k a year. Welcome to northern virginia.
I'm really looking forward to the end of paying for school because we can finally get a much-needed new car. Once they're both done, it'll be the equivalent of getting a pretty decent raise.
For comparison, a couple of 5 year old Japanese cars run me less than $100/month insurance and around $600/year in property tax in NoVA. No payments because we saved up and paid cash, but if there were, they'd be well under $1,900/month.
> State and federal tax + ss take about 45% of gross.
Even after the mortgage deduction? Have you calculated your effective tax rate? Mine is around 30%, including sales taxes.
There will continue to be waves of this as we see places like Nashville, NC cities, SLC, Charleston etc building up now.
This relocation is a form of spreading the wealth and based on geography the optimistic view is some of the benefit will go to areas we saw most left behind and divided this election (south, midwest).
In the long term that could be a boon to middle class outside megacities and more opportunity to escape the mega city bubbles/echo chambers
That's not to defend the way that most of the property industry has become simply a vehicle for financial speculation, which is to the benefit of nobody who isn't at the apex of the financial services industry.
This rise in rents has also made it difficult for generation/s to ever consider buying while living in London. Young people typically move to London and then when they want to settle down, they leave. As you get older the idea of communal living soon loses its appeal.
This has long been a dynamic in many large cities though and only in part because of housing costs. Of the significant number of classmates in my MBA program who moved to Manhattan for jobs after graduation, only a handful remained in the city once they got married and had children. Many of those could have remained in Manhattan if they made the inevitable compromises--and there will always be trade-offs city vs. suburbs--but didn't choose to do so.
Television. In a small apartment, if one person is watching TV, the rest of us are locked into it too. Any hope of reading, programming, or any other focused activity goes out the window. After long days in a noisy open-plan office, coming home to other people's blaring TV show wore down my sanity very quickly. No job could possibly be good enough to justify that life.
In college, you could at least escape it in any of the multitude of secure 24x7 spaces with tables, power, WiFi, etc. But the libraries around here close at the end of the workday, and that's about the only quiet public space we have in this country.
I'd kill for a "media only with headphones" communal apartment.
(1) Do not such articles sound like "not everyone can afford a holiday in Hawai"? Or "all my friends have a Mercedes AMG but I don't"? What is the difference? *
(2) In Bay Area, the daily commute itself is an obvious sign of overpopulation. How does more housing not make it even worse?
* I exclude the gentrification problem which is really affecting the lives of poor and old people as their mobility is far worse than middle class, and most of the time they won't be able to buy the new houses and apartments anyway.
Throughout US history there have been economically booming areas where people could move to become more prosperous. The majority of good new jobs are in cities. The fact that we are not building enough housing and transit infrastructure so people can actually live somewhere while working those jobs is a problem for national employment and economic growth. The landlords end up taking home a great share of the economic benefit instead of the workers as the price for scarce housing is bid up. This is also the root cause of gentrification.
This leads to megacommutes as people occupy housing further and further from the booming economy. That's clearly the case in the Bay Area, where many cities have built more units of office space than housing, guaranteeing a rough commute for the people who work in those buildings.
It would be useful, for many reasons, to have a greater proportion of people living in cities. So, it's useful to challenge your implicit assumption that doing so ought to be a luxury.
(2) In Bay Area, the daily commute itself is an obvious sign of overpopulation. How does more housing not make it even worse?
a) The commute is awful because the Bay Area is overpopulated relative to its transit infrastructure, not some natural limit. Or, conversely, the Bay Area's transit infrastructure is under-provisioned relative to its population. Faster, more extensive transit infrastructure can drastically improve the commute at both current and higher population levels.
b) We also underutilize the land close to commute destinations, so everyone (but the residents of single-family homes near downtown) has to travel further than they should. Pedestrians don't need much in the way of infrastructure (just sidewalks, which most of SF already has). Building more residential skyscrapers in the midst of business districts lets more people walk to work in a short time. Building more mid-rises (~6 stories) where there are currently single-family homes gets more people into commute distances that are reasonably quick on a bicycle, motor scooter, or public transit. Density of residents also promotes density of stores, so that i.e. everyone can be a short walk from their grocery store, rather than needing a car to shop, and the reclaimed land previously dedicated to parking can house more people.
(2) IMHO, housing may for sure move some people closer to their work but it also means more service workers and other jobs to move to the same spot; this sounds to me like a vicious circle. At the end isn't it this vicious circle that drives city growth? Even if the commute problem is solved, which I doubt looking all the cities I lived or know a little bit, how are we going to prevent the classic environmental challenges: clean water, or effects on natural habitat?
In general, city living is not a luxury. Living in what are generally viewed as desirable neighborhoods of certain cities is.
[0] http://www.smh.com.au/nsw/the-retirement-wave-changing-sydne...
So just because you rent a place somewhere for a couple of years you are entitled to be able to stay there forever? even if everything around you changes?
What if I have more money, and I want to move in as well, but can't because you are still renting the place you are entitled to for cheap?
> That’s what’s happening in Fort Hill, a traditionally African American neighborhood that is whitening every year as black residents who’ve rented there for decades are replaced by high-turnover college students willing to pay the ever-higher market rates for apartments.
I find it disturbing that this article throws in race despite this being a purely economic situation.
Someone enlighten me, why does the government have to listen to the wealthy NIMBY's over the longtime residents? Are certain voices more important than others? We live in a egalitarian democracy, no?
Good grief.
...Might have worked 8 years ago.
They're doing it for fiscal/influential reasons, not political, but yes, this trend would benefit the Democrats, except that you can't attract hipsters with policy.
But there are some things that we don't control. Probably the most important engine of growth in the entire state is located in our city -- the university -- but the city doesn't operate it, and we have no voice in state government thanks to partisan gerrymandering.
There are plenty of places to live in America. You have to adjust your standard of living and your expectations according to your income and desires.
The trend in US wages/employment for youths doesn't seem to signal that. The trend in wages/employment for youths in nations with even lower fertility rates (Spain, Italy, Portugal...) doesn't seem to signal that. Even Japan, where absolute population decline is already underway, has good-but-not-amazing trends in wages and unemployment for youths. Where's the race to bid up the prices for young workers, and buy all their labor that's for sale, if an aging work force really is leading to crisis-level worker shortages? If the market expects a huge impending shortage of (e.g.) coking coal, you don't see the same lackluster demand for the output that's currently available.
Maybe you meant that the shortage isn't coming in the next couple of months or years, but in a generation or so, so the market reaction isn't there yet. The view that I subscribe to, which seems common here on HN, is that technological change is going to significantly reduce the market demand for human labor in a generation or so. I expect that automation will generally deflate the market price of human labor faster than an aging work force can inflate it.
Social Security solvency currently depends on lots of middle class workers earning wages, because its funding is structured that way. But that's a policy choice that is more easily reversed than fertility rates or technical progress in automation. If the problem is more about paying for retirees than lacking warm bodies to do work, higher fertility just makes government funding problems more severe: you end up with more people who need non-market support mechanisms if the market demand for additional human labor isn't there.
- 15% on "luxury" goods and services such as travel, coffee shops, restaurants, event tickets, and my car, all of which I can do without at slight to moderate annoyance.
- 5% on necessary goods and services such as groceries, household supplies, and transit across the Bay.
- 80% on rent, including parking.
The cost of production isn't entirely absent from my true expenses; I do need groceries, and some tiny proportion of my rent pays for the actual materials, construction, and maintenance on the structure and associated infrastructure. But my dirt parking space next to BART certainly didn't need producing (the most produced thing in that lot is the fee collection machine), and I spend as much on that as I do on food.
So, I would not mind even a massive increase in the cost of goods and services, if it came with more money overall (which I can also use for space) and/or a decrease in the cost of space (i.e. fewer people contending for it).
OTOH, all Bay Area tech jobs ultimately rely on consumer spending, so if there is not enough of that going around, probably no paycheck.
I think there is a reason why everyone is railing/downvoting on Ryan here, and it's because of a difference in definition. There's two ways to define "middle class". One is by what you can afford: house, car, but not stuff like a private boat, etc. The other way is just by taking some middle percentage of the income brackets (middle 60% or whatever).
Historically[1], Ryan is actually right here. For the baby boomers, both groups are right because they overlap.
Much of the societal issues were seeing and will continue to see for the near future are because those groups are once again starting to not overlap (in certain areas, as highlighted by the original article).
[1] Right by historically, I mean that centuries ago the lower class was like 90% of the population or something... Middle Class was mostly not a thing.
Nationwide the middle class is more like $40-50K (household income).
If your household (how many earners it is comprised of) is over $100K in annual earnings then you're in the top quartile (25%!) of the entire country in income, and decidedly not "middle class" (though, depending on where you live, you may or may not have enough to afford a home, much less a boat, a beach bungalow, eating out, going to the bars, etc.). Keep in mind that a lot of these cities are okay for singles, but once those singles get married and have kids they rapidly discover they can't afford the big city anymore and have to leave.
Perhaps another way of thinking about the situation, is not that the middle class can't afford traditional middle class amenities, but that the proportion of people who can afford those amenities is shrinking.
<pedant>That's not how this works. Middle-class, is by definition, somewhere in the middle of the household income range. Exact position is open to debate, but you can't just declare "only the top 6% are middle class!"</pedant>
Throwing out $200k as a typical middle-class income just demonstrates the bubble the OP lives in. I live in one of the wealthiest counties in the nation (Fairfax) and we don't come anywhere close to a $200k median household income.
But I agree; 200k is not the bottom bar or average for middle class.
Of course, all the space also has massive drawbacks... car-centric culture, sprawl, long commutes, harder to implement public transit, etc.
In 1973 average house size was ~1500 sq ft. In 2010 it's ~2200 sq ft.
In the area I live in -- not even a big city -- you're basically forced to choose house size and house age at the same time. If you want only 1400 SF you're buying an old house with old quirks (asbestos, a history of lead paint, old wiring...) If you want a new house you're buying more square feet and the additional burdens thereof (more space to heat and cool, more space to clean). There's practically no such thing as a new well built small house, or at least none that I could find when I was buying. I ended up in a 1940s house because all the newly built houses were too large for my tastes. And those huge new houses often had huge lawns that needed a riding lawnmower and ridiculous amounts of water (why is everyone landscaping a desert climate like we live in rainy England, argh...)
Is there some weird feedback loop going on? "Our sales indicators show that buyers preferred even-larger new houses this year than last! (Because we didn't give buyers any options to buy smaller new ones.)"
Wages have not been keeping up with costs or you might have a point.
You realize the median household income is 50000, right? So, in a small city you have to make 4x the national median to just survive?
Wow, I know the West Coastians live in a well-protected self-imagined bubble, but this comment really brings it to light.
Glibly saying that having fewer kids on average is better is awfully bold, verging on ignorant (as would the opposite argument).
It is true that in order to make ends meet in a big city, many families have many fewer kids (one or two, from what I saw in San Diego).
First off, you are dismissive of the issue with that bit of exaggeration. It is not as if this group wants all the good things in life that only a tech salary afford. Perhaps a dignified life would be sufficient.
You also place NYC, SF, Boston, DC, etc. into a category of city that is naturally not available to the middle class. Is NYC a luxury like a 3500 sq ft house and boat? Housing scarcity and the resulting price inflation is actually a situation that residents of cities accidentally created, something highly unnatural.
Working class and middle class people are critical to the economy and wider culture of cities. Teachers. Police officers. Artists. The guy who makes your coffee. The gal not from a wealthy family who wants to start a business.
It is not enough that a certain group can just live somewhere in America. Critical workers must live within a reasonable commute to their jobs.
There should be plenty of places in each city for them to live in, and there should plenty of infrastructure in place to move them about.
Once those cities are unaffordable for the very people you mention, they will just move to more affordable places where they have a better cost of living, and then they will bring ideas, creativity, and resurgence to these areas and make them better.
If you're a critical worker, then surely you can demand a pay raise. If not, move. If somebody can replace you, you're not critical. If somebody can't replace you, they'll have to pay more.
I'm not dismissive of the cost of these cities at all, nor the plight of those living there, but you get what you pay for. If you're a teacher in New York and you can't afford rent, move somewhere else instead. What else are you going to do? Rent control? Then you just have people who can never afford to build lasting wealth because they will just rent for life.
There isn't a 'solution' to this 'problem' because it's just a basic fact of human organization. I'd love to live in Colorado, maybe Breckinridge, but I can't afford that. So I live somewhere else and visit. Does that suck? Yeah sure, it also sucks I can't buy a Ferrari.
Ideally we want mixed-use development neighborhoods with differently priced homes for people with different income levels to live in. But it looks like without the government enforcing it, that isn't going to happen.
While it is beneficial to improve districts, the migratory upgrading of urban areas is an economic model that may be problematic for the population. People need to get work done and take care of their families, not constantly deal with a series of dismal choices and life-uprooting changes.
Instead of waiting for price bubbles, wage bubbles, hostile populations causing problems due to inadequate conditions, perhaps cities should work on the infrastructure of growth.
There are many necessary conditions for civilization that governments enforce or produce. I argue that generating NYC conditions for the general population is one of them.
OMG, I certainly hope not. They'd certainly better not try to generate NYC conditions for me.
Whatever the category of neighborhood -- big city or small town or even country -- there are minimum requirements for a decent life that IMO the community is morally obligated to create.
The difference is scarcity.
Computers and internet are can be produced at very cheap costs. Whereas, almost by definition, urban real estate is scare and in high demand. If it weren't, it wouldn't be crowded.
Often scarcity can be addressed if the community decides that it is harmful or not necessary.
It's just unrealistic. The pragmatic thing to do is just make one move and move out of the big city. You can lead a nice life in many places. Move to Alabama or something.
I can't afford a big city and I have a great life where I live. I visit those big cities when I want instead of dealing with the hour commute and sky-high prices.
That's what I keep saying about Paris. One should put down the Eiffel Tower, it will make rent and buying cheaper for everyone. Don't care about that big building.
Didn't choose the shop, the people, the luxury... Just forced to be in the capital to have a job.
But it seems to me that each of us is born in a place, and that place, having a government and resources, is obligated to foster a decent and productive existence for that person as they pass through life.
A family is definitely more costly than a single person, and may be more difficult. But the article defines middle class as $50-$125k / year. With a $125k salary, you could afford 3 people living like me (including each having their own apartment). So I think the article is a bit extreme. On $50k, it'd be harder, but definitely do-able with some effort.
And while Silicon Valley and the greater NYC area are something of exceptions, you get out of the urban cores of somewhere like Boston/Cambridge and housing prices go down fairly quickly except for some particularly upscale towns.
But it would be pretty sad to grow up in a working class family and then be forced to move away from your hometown at the age of 30 because rent had grown faster than your ability to generate income.
There are trade-offs everywhere. The reason these crazy cycles continue is because people refuse to accept alternatives. If more people said "screw you guys, I'm leaving" to expensive cities, the cities would start to become cheaper.
There are also cities that die off because the industry in them goes away. Are we going to force them to stay where they are so that they don't end up bidding up prices, driving kids born in Oakland out of Oakland?
Very recently, there were the 'unworthy' Japanese salaries. They were 50%-80% higher that what I am used to see around me for equivalent qualifications, but no, the general opinion here was that they were outrageously low (without consideration for any other factor).
I also remember one guy saying he was earning 150k$/year and that leaving in France was with that salary OK but barely so. Truth is that's 3 to 4 times what most mid-career engineer earn, and their salary allows them to have an easy life. That's 6 times the median salary, which means that half of the population can live 6 years or more with a single year of his salary. That's 8 times the minimum wage, and lots of people live with it, some without any problem, some with difficulties, depending on the family situation, the location and the spending habits, but they all make do. Finally that's 20 times the amount of welfare, which is enough to live a poor and simple life. So the guy could have lived, say 10 years with a single year of his income, and yet he was whining.
My jaw regularly falls when I read money/salary related posts on this forum.
If someone is 22 and is making 35k a year, and can keep all of their expenses at 15k per year (it's easy to find places in Dorchester 850 rent all inclusive for a room plus 150 food and 3k year entertainment), save 5k per year for retirement and emergencies and finally save 10k for a house they'll be have 100k when they're 32. With 100k in boston that's 25 percent on a 400k house in a suburb or parts of Dorchester. Worst case, move somewhere cheaper and that can be as much as 50% down.
Keep in mind this assumes no salary increases and no spouse. It's very doable, but people want to live a lavish life. Can you live a lavish life in Boston for 35k? Nope.
Also the plan I described already had leeway for unexpected expenses.
12k housing and food 3k entertainment 10k house 5k saving
I agree that it would be a boring life. That being said, this is using 35k and not the 50k minimum being defined as middle class, per the article.
1. http://taxformcalculator.com/state_tax/massachusetts/35000.h...