New York City Neighborhood Residential Affordability Gradient

In this article, I will paint a valuable residential real estate affordability gradient across every neighborhood in New York City by analyzing and mapping census data.

Real estate professionals can use this analysis broadly to understand price gaps between neighborhoods, target areas of future growth, and get a general feel for neighborhood residential affordability. People who are thinking about moving can also gain some insight into affordable neighborhoods about which they may not have previously known.

The methodology is simple. We look at the percent of owner-occupied housing valued within a specific price range as recorded in theAmerican Community Survey (ACS) housing data and then we map those values to neighborhood tracts as defined by PUMA (Public Use Microdata Areas) community districts.

Here’s what we find:

Percent of Owner-Occupied Housing valued $1,000,000 and up

Here’s how to read the map

The labels represent the percentage of owner-occupied housing in that area valued above $1M. The colors correspond to those values. Darker red means a high percentage of housing is in that price range. Lighter yellow means a low percentage of housing is in that range. This is what I call the “gradient” of city affordability.

From both real estate and urban development perspectives, this map is particularly important because the affordability gradient is essentially equivalent to a value maximization gradient. The darker areas are the most valuable areas and the lighter areas are the least valuable areas. If you hypothesize that the city is growing outwards from Manhattan, then you can easily project which areas are up and coming.

For example, 25-30% of owner-occupied housing in Central and East Harlem is valued over $1,000,000, but just across the river in Hunts Point, Longwood, Melrose, Concourse, High Bridge, and Mount Eden (all in the Bronx), less than 1% of owner-occupied housing is valued over $1,000,000. That’s an incredible gap in pricing for such a short physical distance between those areas. Real estate developers and urban planners have to ask why. What could be done to increase land values, create growth, and generate profit?

You can also see Bushwick as the next area of growth in Brooklyn. With just 1.6% valued above $1M, Bushwick is wedged between Williamsburg/Greenpoint at 16.2% above $1M and Bedford-Stuyvesant at 9.7% above $1M. That’s another huge price gap unexplained by distance.

It’s also interesting to note that the east side of Manhattan, classified in PUMA as the Lower East Side, Chinatown, Murray Hill, Stuyvesant Town, and Gramercy, appears to be significantly more affordable (less expensive) than the west side. In comparison to the west side, the east side has a much lower share of owner-occupied units above one million and a much higher share of units in the $500-999K bracket. If I were a real estate developer or potential homeowner, I’d be looking there for cheap opportunities within Manhattan (relatively speaking).

There is a lot you can learn from this simple map.

In addition to the $1M+ price point, the American Community Survey also includes a variety of different price ranges for us to review:

  • Less than $50,000
  • $50,000 to $99,999
  • $100,000 to $149,999
  • $150,000 to $199,999
  • $200,000 to $299,999
  • $300,000 to $499,999
  • $500,000 to $999,999 (Mapped Above)
  • $1M and up

For your viewing pleasure, I’ve mapped out each of the price points from $200,000 and up.

Percent of Owner-Occupied Housing valued $200,000 to $299,999

Between $200,000 and $299,999, a quick look at the units on the legend shows that there isn’t a ton of owner-occupied housing between that price range. The neighborhood with the highest percentage is Forest Hills/Rego Park, but only 26.4% of the housing in that neighborhood is in that range. Naturally, that means 73.6% of owner-occupied housing is outside of the $200-299K range. Hover over Forest Hills/Rego Park and you can see that ~56% of owner-occupied housing is above that price range and the rest is below it.

Regardless, Forest Hills/Rego Park has the highest percentage in that range. Some other options are Washington Heights/Inwood/Marble Hill, Hunts Point/Longwood/Melrose, Riverdale/Fieldston/Kingsbridge, Port Richmond/Stapleton/Mariner’s Harbor, Sunnyside/Woodside, and Concourse/High Bridge/Mount Eden.

Remember, this doesn’t mean you can’t find housing at this price range in other neighborhoods. It just means you’re more likely to find housing at this price range in these neighborhoods.

Percent of Owner-Occupied Housing valued $300,000 to $499,999

If $300,000 to $499,999 is your sweet-spot, Wakefield/Williamsbridge/Woodlawn, East Flatbush/Farragut/Rugby, Jamaica/Hollis/St. Albans, Queens Village/Cambria Heights/Rosedale, Brownsville/Ocean Hill, Port Richmond/Stapleton/Mariner’s Harbor, and East New York/Starrett City are all prime targets.

Percent of Owner-Occupied Housing valued $500,000 to $999,999

If you’re looking for housing between $500,000 and $999,999, you’re best off searching in Bensonhurst/Bath Beach, Bay Ridge/Dyker Heights, Bedford-Stuyvesant, Bayside/Douglaston/Little Neck, Astoria/Long Island City, and Greenpoint/Williamsburg. Those are the neighborhoods with the highest percentage of owner-occupied housing within that price range according to the ACS data.

A little bit about the data

The New York City Department of City Planning (NYC DCP) publishes an enormous amount of census data. You can browse through everything here.

The data I used for this analysis was the housing data provided by the American Community Survey (ACS) which is conducted annually. The specific dataset is located here (this links to an Excel spreadsheet hosted by NYC.gov).

For more information about the ACS, check out their website or their methodology documentation.

Additional Notes

  1. I used the most recent data available, but it’s from 2014, so it is a little old. That said, while housing prices have certainly changed (upwards), I think the overall gradient still applies. The general structure & profile of neighborhoods across the entire city would not have changed significantly over two years.
  2. The housing price data is collected via survey. It represents what the homeowners believe their homes would sell for on the market at the time the survey is taken. Naturally, this won’t be 100% accurate, but it should provide us with a reasonable ballpark.
  3. Shout out to Frank Donnelly of Baruch College CUNY for his exceptional tutorial on how to map a PUMA shapefile in Carto and then merge it with additional PUMA-level data. If you want to replicate what I did, go read Frank’s article.

Conclusion

You can generate a number of interesting insights from the $1M+ map. Look no further than the price gap highlighted by this map to explain why so many real estate developers have been scooping up properties in the South Bronx. Factor in major capital investments like the Second Avenue Subway expansion (whenever it’s finally done) that will drive economic growth and that area looks ripe.

You can also see that there are actually some affordable neighborhoods in New York City! And if you look hard enough, you can see that there are areas at low price points scattered everywhere. People looking for affordable housing aren’t limited to one or two areas, but they are mostly limited to the outer boroughs.

On a personal note, this analysis was a wonderful learning experience for me because it was my first exposure to dealing with and mapping out census data. Expect more from me in this same style. The census/ACS data available covers a wide variety of social, economic, and demographic measures.

 

Summary
New York City Neighborhood Residential Affordability Gradient
Article Name
New York City Neighborhood Residential Affordability Gradient
Description
A geospatial analysis of residential housing affordability across every neighborhood in New York City using American Community Survey data.
Author
Publisher Name
AndrewLax.net
Publisher Logo