Manhattan Institute for Policy Research.
search  
 
Subscribe   Subscribe   MI on Facebook Find us on Twitter Find us on Instagram      
 
 
   
 
     
 

New York Post

 

Rent's Too Darn Low

October 21, 2010

By Steven Malanga

A sign of ailing NY economy

In New York state, contrary to gubernatorial candidate Jimmy McMillan, the rent is not too damn high. It’s actually too damn low in most places -- and that fact reflects the state’s true problems.

McMillan created a sensation at this week’s gubernatorial debate with his handlebar mustache and his incessant repetition of his slogan about rents being too high.

Although McMillan is evasive about his own rent (The Post reported yesterday that he pays $800 a month for a Brooklyn one-bedroom), news accounts and typical “voter in the street” interviews suggest many people approve of McMillan’s gripes that rents are too high -- including gubernatorial frontrunner Andrew Cuomo.

But it misses the point. Rents are an expression of economic activity -- and they’re very low across much of New York, reflecting the state’s lousy economic performance.

According to Census figures, median rents in 44 of New York’s 62 counties are below the national median of $819 a month. In more than a dozen counties, in fact, the median rent is a whopping 25 percent or more below the national median.

Yes, rents in some counties are substantially above the national median -- but so are incomes. In Nassau, for instance, rents are 70 percent higher than the national median, but annual household income is 80 percent higher.

Even in Manhattan (where rent-control laws distort the market), rents are 40 percent above the median, but family income is 30 percent higher, too.

There’s a correlation among income, jobs and rents that should make us cheer when rents go up. Consider the counties in New York state with the lowest median rents: Chenango, St. Lawrence and Franklin.

In the last 20 years, Franklin County has seen no new jobs in its private sector; in Chenango, private employment has shrunk by 10 percent. In St. Lawrence, private jobs have grown by a meager 5 percent in two decades.

It’s not difficult to understand why landlords can’t charge much for rents in these places.

This lack of opportunity is one reason why New York is losing so many people to other states. From 2000 to 2008, for instance, New York led the country in migration to other places -- a net outflow of 1.5 million residents, according to a study by the Manhattan Institute’s Empire Center for New York State Policy.

And, lest you think these folks are fleeing high rents in places like Manhattan, the net outflow took place in virtually every upstate county, including many where rents are quite affordable by national standards.

People are following jobs. A new study by the Empire Center found that New York is among the states that lose the most jobs to other states. New York also ranks among the worst in job creation. This isn’t surprising, considering that business executives consistently rank the state as one of the least desirable places in the country to operate.

The focus of the gubernatorial campaign ought to be on reform that makes the state economically competitive, including lower taxes and less regulation. Do that and job growth will follow. Then rents will go up -- and we’ll all cheer.

Original Source: http://www.nypost.com/p/news/opinion/opedcolumnists/rent_too_darn_low_YzIXRhghOAkV5xzJmBbLSI#ixzz12zwIaKzk

 

 
PRINTER FRIENDLY
 
LATEST FROM OUR SCHOLARS

The Real Challenge When Police Use Lethal Force
Stephen Eide, 12-15-14

Why Cops Need To Sweat The ‘Small Stuff’
Nicole Gelinas, 12-08-14

A Bill To Loosen Police Discipline
E. J. McMahon, 12-08-14

More Subsidies For Big Wind
Robert Bryce, 12-08-14

Bill Slanders His Cops
Heather Mac Donald, 12-07-14

What The Numbers Say On Police Use Of Force
Steven Malanga, 12-04-14

Detroit's Bankruptcy and Its Painful Reforms
Stephen Eide, 12-04-14

The EPA Pours On The Pain With New Ozone Regulations
Diana Furchtgott-Roth, 12-03-14

 
 
 

The Manhattan Institute, a 501(c)(3), is a think tank whose mission is to develop and disseminate new ideas
that foster greater economic choice and individual responsibility.

Copyright © 2014 Manhattan Institute for Policy Research, Inc. All rights reserved.

52 Vanderbilt Avenue, New York, N.Y. 10017
phone (212) 599-7000 / fax (212) 599-3494