Had anyone actually analyzed this Cost of Living argument?
I just did some cursory googling and mean 1 bd / studio apt in Manhattan are on an inflation adjusted basis the same price as in 2012 (3.2k to 4K for 1br) and analyst salaries all in are about the same as well inflation adjusted (120 70k base + 50k bonus) v 150+). Maybe I'm missing something only spent 5 min and posted this thread but what do we need to adjust here?
Or is it perception? Or perhaps the measuring point is closer vs 10 years ago eg 3-5 years ago I'm sure there was a peak income to rent ratio in there somewhere
obviously by definition an inflation adj salary being flat means all costs have been accounted for in the basket but I wanted to do a housing only comparison in Manhattan too just to be sure
I don't think the average investment banking analyst is having extreme difficulty making ends meet on their six figure salary, it's the middle class and below that is really being hit hard. Low wage workers have not seen the same gains and are completely priced out of living in Manhattan or nearby areas
Also I think your housing numbers are a bit off - the 1 bedroom average in 2012 was $2.7k per NYT. That same metric hit $5k in 2022. So don't think that part is flat on inflation-adj basis.
Can you show backup? I found 2.7k for no doorman and 3.8k for doorman in Manhattan and took simple average back in 2012.
the 5k number you're citing shows up as manhattan wide average apartment not 1 bed. Thanks
Are you just looking at old listings? I'm using the monthly reported metric for Manhattan-wide 1 bedrooms. Citi Habitats used to publish it in 2012, they were acquired by Corcoran so they publish the metric now.
2012: "Rental averages are up in every category, with one-bedrooms rising the most, by 6.5 percent over the past year, to $2,747, according to the Citi Habitats report." Link
2022: "Rents for one-bedroom apartments climbed 32%, to $4,500." Link
No the 2012 numbers are nyc wide not manhattan
"Landlords like to have leases signed in the spring, when they can command the highest rent because so many people are moving for work or school. So across the city, thousands of renters are facing a similar dilemma.
Rental averages are up in every category, with one-bedrooms rising the most, by 6.5 percent over the past year, to $2,747, according to the Citi Habitats report. Studios rose 3.6 percent, to $1,953; two-bedrooms climbed by 6.1 percent, to $3,865; and three-bedrooms rose 4 percent, to $5,107."
Im using this and averaging doorman and non doorman
https://www.mns.com/pdf/manhattan_market_report_year_end_12.pdf
looks it's like grown with inflation.
Yes that is exactly why a group of my friends are looking to move into Brooklyn specifically Bushwick. The commute is under 30 mins and near nightlife. Saving on massive rent will save us time from not having to meal prep
One inherent assumption in your analysis is that the amount of space an analyst needs has remained constant over time.
With hybrid work culture, this assumption unfortunately goes out the window. Back in the day you could have 4 people flex out a bare bones 2 BR with basic cots. It didn’t matter much because almost all waking hours were spent at the office and / or traveling to client meetings. Also, since that was the norm it wasn’t a big deal to come out bleary eyed out of the office at midnight since a lot of other workers were doing the same.
Today, you have to ensure you have a quiet working area with adequate internet and spacing. And because most of us are dealing with MNPI on a daily basis, your fellow roommates can’t look or glance at your screen and see what you are doing. There are definitely ways you could try to bend the rules here but once everyone is in a meeting at the same time with cameras on it will become a problem. Needless to say, this requires a decent , private room even if the apartment is shared which is much higher than the old threshold. You could argue that said analyst could stay in the office, but when it’s customary for a lot of groups to clear out at 5-6PM, it means there are a lot less people out at late nights which can lead to safety concerns. Because the working arrangement is hybrid, you’re still bound to a HCOL / prime area so really it becomes the worst of both worlds.
I don’t think the work culture is ever going to shift to fully remote or in-person because seniors like the hybrid arrangement. It’s a great arrangement if you already own a house in the suburbs and get to see your family and pet your dog more but still want to remain in touch with your coworkers. But for the first year analyst, it’s the worst arrangement in terms of costs.
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