How much of their salaries are new grads really spending on rent?
Phil Roeder/Flickr
The real estate headlines this week seemed to imply something of a cooling rental market, or at least a not-white-hot-market (according to Douglas Elliman, concessions were up year over year). But we all know the rent is still pretty damn high. In fact, according to Elliman, the median rental price for a Manhattan apartment is $3,369, while it's $2,780 in Brooklyn and $2,753 in Queens—the only one of the three boroughs where that number dropped from last year.
Over on Curbed we saw news of a study by apartment rental app RadPad which found that new graduates could spend 77 percent of their salaries to pay rent (assuming that the median rent for a one-bedroom is $3,000 a month, and that the median entry-level salary is $47,000). Renters are usually advised not to spend more than 30 percent of their salaries on rent in order to stay financially afloat.
And it seems our theory that San Francisco in 2016 is actually more expensive than New York holds true, at least according to RadPad. New grads would have to pay 79 percent of their incomes (which at $53,000 a year average is higher than New York), on rent.
In reality, though, we doubt the numbers are that shocking. How many new college grads are renting their own one-bedrooms (without parental help) anyway? This is the land of multiple roommates and studio apartments after all.
According to Matt Hutchinson of roommate matching website SpareRoom, the average monthly room rents by borough are: $1,436 in Manhattan, $1,095 in Brooklyn, $763 in the Bronx, and $1,006 in Queens (Queens surpassed the $1,000 mark for the first time this year, in fact). That would mean that New Yorkers living with roommates are paying closer to 30 percent of their income on rent. (Interestingly, SpareRoom recently expanded into San Francisco and found the average room rent there is $1,368—somewhere between Manhattan and Brooklyn.)
A couple of years ago, SpareRoom conducted a survey of New Yorkers living with roommmates and found that between the ages of 18 and 24, 35 percent lived with one other person, and 31 percent with two other people; 17 pecent said they live with three others. And, according to SpareRoom, 64 percent of people ages 18 to 24 pay between 31 percent and 65 percent of their income on rent; 18 percent pay 66 percent or more.
Interestingly (and rather depressingly) "women pay more of their salary on rent, in part because women struggle to get higher paid jobs but also because, even when they do, they don't get the same salary as male employees to do them," says Hutchinson. ""So, being a young grad is a struggle; being a young female grad is a bigger struggle."
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