NYC - Location Affordability
Mike Slattery, Senior Vice President, REBNY Research Department published very interesting numbers in the REBNY Reaserch
newsletter. The Citizen’s Budget Commission has issued a series of
reports comparing New York City's affordability to
that of the 21 largest cities in the country.
They also compared the
competitiveness
of New York City using a concept of “location affordability” developed
by the U. S, Department of Housing and Urban Development (HUD) which
includes the cost of transportation as well as housing, usually the two
largest items in a household’s budget. According
to HUD’s Location Affordability Index (LAI) that measures these two
costs, a household paying more than 45 percent of their income for these
costs is overburdened.New York City has the sixth highest housing costs of the 21 major cities (See Figure 2 below). However, New York City has the lowest annual transportation costs of the cities surveyed, primarily the result of the majority of commuters using public transportation (See figure 3 below).
As a result, based on HUD’s LAI New Yorkers devote 32 percent of their income to housing and transportation, well below the 45 percent level established by HUD to signify an affordability problem. Of the 21 cities surveyed by the Citizens Budget Commission, New York City was the third most affordable location according to the HUD LAI (See Figure 6).
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