Long Island: Why is it so expensive?
Long Island is an interesting place to live. At it’s furthest end you’re still within a day’s drive to Manhattan, and everywhere in between the Hamptons and Garden City are some of the most highly rated school districts and public facilities. Not to mention, green lawns and driveways- both luxuries to the life-long urbanite looking to get out of the Five Boroughs.
The only issue? For the cost you’ll pay for a three bedroom on the Island, you could afford a small plot of land a spaciously sized home elsewhere. Long Island is one of the most expensive places to live in the U.S.
So if you’re looking to make a move, here’s some things to consider before diving into our Whale Tailed stretch of land.
School Districts
Long Island is home to some of the best public schools in the country. Several within the top five hundred, a fair few in the hundred, and a few even in the top twenty five according the U.S. Department of Education’s listings. Some of these schools can even boast better success rates than a majority of private schools, and best of all you only have to live in the district to have your children get this level of education.
That and pay the taxes.
Public school isn’t actually all that free when it comes down to it. The New York budget for education is twenty four billion dollars, of which eighty five percent comes from taxes. And based off the New York school system works, schools with better success rates get bigger budgets which means more taxes. So a school that’s ranked in the top fifteen in the country? Expect to be putting down a fair amount of money for education. Moreover, you’re going to have to contend with an intense Sellers Market as people try to flock to these areas. So expect high prices just due to good old supply and demand.
So my recommendation? Check your school districts before making a move and if you have no kids maybe it’s better to just avoid these areas all together.
Manhattan and the Hamptons
To the East of Long Island is NYC, with Queens making up the Easternmost shore of the island. As stated previously, New York City is one of the most expensive places to live in the world. Sixteenth most expensive, actually. To the West is Riverhead, Montauk, and the Hamptons. The entire area has become something of a much sought after place of residence for the wealthy and famous, making it almost exclusive for the millionaires among us.
So, on both ends are places that only the most wealthy people in the world can afford. So what’s that mean for everyone in between? Well, while you’ll find a variety of economic stratification, they’ll almost always be more expensive than an equivalent elsewhere. For example, the average cost of an acre of land in Texas is about $7.5k. Texas is the twenty seventh least expensive state based of property value, putting it in about the middle of the states while still boasting Dallas and Austin. New York is $41.3k on average per acre, and roughly $50k for Long Island in particular. One farm owner in the Hamptons was even offered roughly a million per acre, to give you an idea of just how high end these areas are.
It doesn’t matter if you live in a manor or an apartment complex, if you found the same exact house elsewhere there’s a very good chance it’d be a fraction of the cost with all the same amenities. Like the neighbor who lets their grass grow too long and the paint chip off their homes, The Hamptons and Manhattan are affecting the property value.
Except instead of lowering it, it’s making it so expensive that it’s become entirely nonviable for some individuals. So if you’re going to be living here and don’t have much intention to take advantage of your proximity to such high end areas? Then avoid towns with train stations connected to the LIRR.
Developments and House Flipping
Anyone who lives on Long Island will tell you that one thing to always expect is construction. Be it an old strip mall getting rebuilt, a home getting an extension, or a vacant lot becoming home to a new shopping center, there always seems to be something being built. And at the end of the day, the area’s almost always nicer for it.
That trailer park? It’s a three story apartment complex now. Old shopping center with low end local-run stores? Mini-mall with a Starbucks. Small starter home perfect for a new couple? A McMansion selling for almost a half million right after it’s been rebuilt.
The issue is that, slowly but surely, the number of places for lower income people to live has diminished. People are investing in housing and services that cater specifically to wealthier individuals at the cost of removing those for the low end. It’s something that’s always happened, but it has been such an extended period of time with the largest Urban Influx we’ve seen in New York City’s history now flooding over into the surrounding areas. Even rentals aren’t safe, as some apartments cost have rocketed so much that a mortgage in the same area would cost less than rent.
In short, if you’re a new home buyer or just starting your career and making less than $50k a year? Long Island is possibly not the place for you, unless you plan on living with a roommate.
Sellers Market
This should be obvious at this point, but Long Island is a sellers market. Property values are high and the perks of living here are abundant. Proximity to the city, good school districts, huge amounts of development. So of course people are going to want to be part of it, usually those looking to work in the City. But there’s only a finite number of homes, and even fewer that haven’t been tailored to a specific type of buyer. The sellers hold all the chips in negotiations, and they can expect asking price and wait because they know there’s going to be another bidder if you can’t afford it.
Sometimes, sellers will even take their listings down after seeing the responses they received and will either relist them even higher or sit on the property. A patient seller that’s money minded may just wait and watch as prices slowly rise and wait for an opportune time to cash out. Which is great for them, not so great for the potential buyer whose bid for asking price was just rejected.
My final word of advice. If you plan on coming to the Island, be ready to spend money and be ready to hunt. A lot. It may take a fair amount of time before you find a seller you can work with.
Final Word
New York is a great place to live, it really is. The city is a gateway to the world and Long Island itself is a pleasant stretch of suburbia with beaches never more than 12 miles away. It has it’s issues like any place would, but it’s full of things to do and places to be.
But unfortunately, it demands more financially than many can give, especially from a younger generation of house hunters just entering the world of real estate.
So while it’s worth it, I just say to you my readers to prepare yourselves if you’re planning to enter and to do your research. No kids? Find a cheap school district. No interest in the city? Avoid areas attached to Expressways or Train stations and maybe move further East. Not much money? Well, just get ready to look and make sure your credit is good. A good loan and real-estate agent can go a long way when it comes to setting up your new life.
But for now, thanks for reading and good luck out there!