Hship_all_code_clean
I. NYC’s Homeownership Crisis
======================================================================================================================
1. Homeownership Rates in NYC
======================================================================================================================
New York City has the lowest homeownership rate of any city with a population greater than five hundred thousand people in the United States, with about 33% of residents owning their homes as of 2023. This is about half of the national homeownership rate (65%), reflecting the fact that the ratio of homeowners to renters in New York City is approximately the inverse of the national proportion.
======================================================================================================================
2. Home Prices and Affordability in NYC
======================================================================================================================
Homeownership vacancy rates over time
Housing prices in New York have continually risen since the end of the financial crisis. In recent years, vacancy rates for rental units have reached record lows, but ownership units are facing a similar crisis. According to Zillow’s housing data, the median listing price for homes in New York has continued to rise as fewer and fewer units are being listed for sale.
Recent Affordability Trends
Income growth has not kept pace with housing prices. This chart, based on Zillow’s Affordability Metrics, shows the income needed to buy the typical home in New York, compared with the income needed to rent the typical apartment, compared with median income in the city. The “Homeowner Income” variable is an estimate of the annual household income required to spend less than 30% of monthly income on the total monthly payment after newly purchasing the typical home with a 20% down payment, while “Renter Income” is an estimate of the annual household income required to spend less than 30% of monthly income on the total monthly payment after newly purchasing the typical home with a 20% down payment. While both buying and renting have been out of reach for New Yorkers making the median income, homeownership has become exponentially more unaffordable, with even those making double the median income unable to afford to buy a typical home in the city.
This chart shows that data from a different angle, visualizing the share of households in New York City with incomes that exceed Zillow’s estimate of homeowner income needed to buy the typical home and rental income needed to rent the typical apartment. Income data is pulled from ACS.
======================================================================================================================
3. Inequities in Homeownership
======================================================================================================================
The racial homeownership gap in New York City is wide and expanding. White households own their homes at more than 1.5 times the rate of Black households, and more than 2 times the rate of Latino households. Asian homeownership rates have eclipsed white homeownership rates in the last decade by about 5 percentage points. However, these raw homeownership rate numbers obscure true racial wealth gaps.
II. The Case for Addressing Homeownership
Preference
While homeownership may not be the best path for all households, a consistent majority of households would prefer to own their home (Note: This data is from the Federal Reserve Second District, which includes New York State, Northern New Jersey, Southwestern Connecticut, Puerto Rico, and the U.S. Virgin Islands).
Stability
While homeownership rates are relatively even across racial groups at higher income levels, low–income white and Asian New Yorkers are far more likely to own their homes than Black and Hispanic New Yorkers with similar incomes. If we continue to see the owner-renter wealth gap grow as a result of property price inflation and income stagnation, low-income communities of color will be hit the hardest. This could lead to exponential growth in the racial wealth gap, as existing disparities are compounded by market trends.
Cost Burden
This chart shows the share of renters and owners (with and without mortgages) that are moderately or severely housing cost burdened (spending >30% or >50% of their monthly income on housing costs). While the percentage of renters that are cost burdened has remained relatively stable since 2010, the share of owners with mortgages that are cost burdened has steadily declined. However, owners without mortgages are far less likely to be cost burdened.