> But I'm often told that, if my apartment was in New York, he'd be taking a loss even at $2000 a month. Why is that

One explanation is the huge upfront investment. The median apartment goes for $900k in NYC these days [1]. According to google's mortgage calculator[2], a 30 year mortgage for $900k will mean a monthly payment of $4.2k.

That means somebody buying an apartment on mortgage will have to rent it for $4.2k a month just to break even.

Then there's also opportunity cost. If there are people willing to pay X for something, you are technically losing a lot of money by selling/renting for less than X.

[1] http://www.nytimes.com/2015/01/18/realestate/what-750000-buy...

[2] https://www.google.com/webhp?sourceid=chrome-instant&ion=1&e...