Ronald Reagan asked that famous question in 1980 – and he got the response he wanted. Mitt Romney asked the same question last week – and didn’t get the answer he wanted. In fact, according to DailyKos.com (a must read political blog), his sponsored tweet hashtag #areyoubetteroff has been running about 5 to 1 in favor of “yes I am!”.
The question of whether you are better off or not than four years ago is a local question. The anecdotal evidence is a strong “yes”. Just stand outside any high-end restaurant, and you will see a line of black cars waiting for the affluent diners.
From our perspective here at RDNY.com, we’ve seen rents skyrocket the past two years. If there were a chart of rents covering the same time periods, I have no doubt you’d be looking at a ‘V’ shaped chart. Anyone who has looked for apartments for rent in New York City will tell you that the prices are as high as they’ve ever been.
Three and four years ago, landlords were offering to pay the broker’s fee if a broker would bring them a qualified renter. Today the shoe is on the other foot and NYC no fee rental apartments are once again in high demand – as landlords no longer pay the broker’s fee.
Of course, at this stage of the recovery, it’s still mostly Manhattan no fee apartments that are in strong demand. But we see the trend spreading to the boroughs.
In the New York City area, the statistics show a very substantial recovery to date. Illya Marritz reports for WNYC (New York’s best radio station) on what the numbers show:
“In New York City, and that’s the only place I am an expert on, things are better than four years ago,” Mayor Michael Bloomberg said in response to a reporter’s question earlier this
But the worst economic crisis in a generation rocked many of the financial institutions that are the backbone of the New York economy, and much has changed in a short time.
Take 70 Pine Street as an example. The landmarked art deco skyscraper is Manhattan’s fifth-tallest building. For 33 years, it was the home of AIG, the world’s largest insurer.
But AIG had to sell 70 Pine Street after the insurer collapsed in September 2008, and accepted a $182 billion pledge of government aid.
The sole remaining occupant is The Ketch, a white-tablecloth fish restaurant on the ground floor.
John Lopez, the owner, estimates AIG employees once made up 40 percent of his clientele. He recalls the autumn of 2008 in the hushed tones other people might use to discuss a sick relation.
“People were scared. Even if people had money, it wasn’t cool to have an event,” Lopez said.
Eighty dollar lunches of miso-glazed salmon and chardonnay were out. But the Ketch toughed it out.
Now, new customers are showing up.
“Facebook had a group of people here,” Lopez said. “I said to my staff when I saw them come in, ‘See those young guys? That’s the future of our clientele.’”
And new potential customers will be moving in soon. After changing hands three times in four years, 70 Pine Street is being converted into a rental apartment building.
After four turbulent years, Lopez says things are improving.
And AIG? In 2009, the company moved to a smaller headquarters down the block. This week, the U.S. government sold most of its remaining stake in the insurer. Commentators marveled that a zombie company has in fact come back to life.
Here are five ways of seeing how New York’s economy has – and has not – improved in four years:
The Size of the NYC workforce.
Since August 2008, New York City has regained all the jobs lost in the great recession, and added 70,000 new positions on top of that.
After a dip in 2009, sales tax revenues have surged, fueled by tourist spending in the city center, and newly opened big-box shopping centers in residential areas. In the second quarter of 2012, the city took in $218 million more than in the comparable period four years earlier.
Banks, law firms and ad agencies downsized in 2009 and 2010, sending the vacancy rate to a peak of 11.6 percent. Since then it’s fallen, but is still roughly two points higher than in 2008.
About 30 percent more people are overnighting in city shelters today compared with 2008. The city says cuts in state aid have made it harder to move the homeless into permanent housing.
This chart of year-over-year changes in the housing price index shows the value of apartments and homes in the five boroughs cratered in 2009, and dipped again in 2011. Prices are now recovering, but still stand below early 2008 levels.
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