Roughing It in Cobble Hill on $350K a Year


You may have read recently about the plight of a finance professional who went on record with Bloomberg bemoaning the difficulty of raising his family in New York on $350,000 a year. “I feel stuck,” he said. “The New York that I wanted to have is still just beyond my reach.” Finance writer extraordinaire Felix Salmon takes a deeper dive on the root of the Cobble Hill resident’s issues:

The problem in brownstone Brooklyn isn’t that the middle class is diminishing. In fact, the whole reason why [he] can’t move into the house he wants is that Brooklyn’s middle class is growing, to the point at which demand from middle-class families for comfortable housing significantly exceeds supply. The natural result is stratospheric prices. Wall Street bonuses might be down this year. But there’s still an enormous amount of money in New York — so much money, in fact, that [he] feels unable to buy exactly the house he wants. I don’t think anybody is going to feel sorry for him — but the very fact that he’s in that position is proof that the rich are doing very well for themselves these days.

While we’re not expecting anyone to shed a tear over this guy’s situation either, it is fair to say for someone with kids in private school (a decision Salmon takes a sardonic swipe at) who wants to buy a house in the more expensive parts of Brownstone Brooklyn, $350,000 a year isn’t going to cut it unless he or she has quite a lot of money in the bank already. Of course anyone who makes significantly less than that is going to think the guy is a jerk for complaining, but it’s all relative.
Photo by Jay Woodworth

125 Comment

  • brownstoneshalfoff

    OMFG I was wondering when you were gonna chime in on this, Johnathan. Interesting story. Peter Schiff’s brother of all people. Never knew he lived in BK.

    ***Half Peak Comps Euroding (tomorrow night?)***

  • minard

    Unlike most other parts of the country., Brooklyn has not seen a dramatic downturn in the real estate market yet. We march to a different drummer but I do not believe we are permanently immune. As the rest of the country’s housing market stabilizes, I would not be surprised to see the bubble burst in Brooklyn. If that happens it may be a debacle given how much buyers have overpaid for modest houses over the past ten or so years.
    And to answer your question: yes. The guy is an idiot for complaining with his sort of income. The Central Planning Commission is not making him stay in Brooklyn nor send his children to the obscenely expensive private schools here. There are alternatives.

  • brownstoneshalfoff

    “demand from middle-class families for comfortable housing significantly exceeds supply”

    Propped up (pulled forward, bailed out, borrowed away, deficit spent) demand. If they’d let everything go naturally in 2008, we’d have contracted in half already. Now we made it worse with more debt, more compound/parabolic interest, more economic dislocations (like $350K not affording Cobble Hill!) and now sovereign debt exposure a la MF Global Capital. Kerboom! 8+% mortgage rates again.

    ***Half Peak Comps Euroding (hairbinger/watershed tomorrow night?)***

  • brownstoneshalfoff

    “demand from middle-class families for comfortable housing significantly exceeds supply”

    Propped up (pulled forward, bailed out, borrowed away, deficit spent) demand. If they’d let everything go naturally in 2008, we’d have contracted in half already. Now we made it worse with more debt, more compound/parabolic interest, more economic dislocations (like $350K not affording Cobble Hill!) and now sovereign debt exposure a la MF Global Capital. Kerboom! 8+% mortgage rates again.

    ***Half Peak Comps Euroding (hairbinger/watershed tomorrow night?)***

  • “I feel stuck,” Schiff said. “The New York that I wanted to have is still just beyond my reach.”

    OMG, the poor thing, he feels stuck, what a shame.

    I can’t even comment about this, because it will most probably not be very nice.

  • USGrant

    Odd. I make significantly less than Schiff and I bought a nice brownstone – and I’m renovating it. I think most people who enter the real estate market with unrealistic expectations usually just adjust and move on. Then some people complain.

  • daveinbedstuy

    Te issue here is that he wasn’t able to save. he must have lived beyond his means for a long time, assuming the $350k isn’t something he made just this one year. Sad really but at some point, one has to take responsibility for one’s life. This guy will be working till he dies. It’s a mentality of consumption that he’s addicted to.

    Minard, do you really believe that the RE market in Brooklyn will burst as the rest of the country strengthens? I doubt it, for the same reason that prices here never went down as much as the rest of the country

    Please, don’t get caught up in Brownstones Half Off disease.

    • Agree on this. He’s complaining that you can only purchase a nice brownstone if you have a lot saved up… Well, yeah, that’s what responsible people do, even if they’re making a lot less than $350k/year. If he’s making $350k a year, he should be saving at least $100k every single year, and he could have saved that much for years, if not decades, past (not clear how old he is). It’s pathetic that he’s living a conspicuous consumption lifestyle and then complaining about his own failure to save up for future benefits. What an idiot.

    • brownstoneshalfoff

      Swayin em one at at time.

      ***Half Peak Comps Euroding***

    • brownstoneshalfoff

      “Te issue here is that he wasn’t able to save.”

      Bull****! He wasn’t able to TRADE UP (Ponzi up) like those UWSders. If saving that much cash was EZ you’da paid cash for your mere $900K beauty in Stuy. It’s rare that buyers actually save up every dollar of their downpayment. Most of these downpayments are sale proceeds, some savings and Mom/Dad. All three are on the decline as we slowly turn back down into the abyss.

      ***Half Peak Comps Euroding***

  • minard

    Most Wall Street financial institutions have announced a fairly drastic cap on end of year bonuses this year.

  • minard

    Most Wall Street financial institutions have announced a fairly drastic cap on end of year bonuses this year.

  • Brownstoner

    If he’s got a couple of kids in private school, he’s down to $250K before he’s spent a dollar on real estate or any other living expenses…

  • Brownstoner

    If he’s got a couple of kids in private school, he’s down to $250K before he’s spent a dollar on real estate or any other living expenses…

  • Felix Salmon sounds like a bigger douche than Schiff.

  • Felix Salmon sounds like a bigger douche than Schiff.

  • daveinbedstuy

    Very few Wall Streeters buy places based on a one year bonus.

  • Here’s a great NYTimes graphic for calculating class:
    http://www.nytimes.com/packages/html/national/20050515_CLASS_GRAPHIC/index_01.html

    I’ve gotta argue that the population in Cobble Hill that Felix Salmon is describing is actually Brooklyn’s large UPPER class, and that Andrew Schiff falls within it.

  • rh

    Is this from the NYT “Neediest Cases”?

  • rh

    Is this from the NYT “Neediest Cases”?

  • With that kind of income and today’s interest rates, FHA limits would allow him to purchase a $2.2M home with 20% down. Sure his monthly payment is $9k but he would still have $20k / month to live on! And if you can’t get a house in Cobble Hill or Carroll Gardens for that amount (not even remotely close to my price range so I can’t even speculate), something is seriously wrong with the world.

  • With that kind of income and today’s interest rates, FHA limits would allow him to purchase a $2.2M home with 20% down. Sure his monthly payment is $9k but he would still have $20k / month to live on! And if you can’t get a house in Cobble Hill or Carroll Gardens for that amount (not even remotely close to my price range so I can’t even speculate), something is seriously wrong with the world.

  • deano

    i’m still trying to figure out how you get to a 350k role in the financial industry, and yet feel comfortable publicly displaying a complete cluelessness about supply, demand, cost of capital, illiquid markets, etc etc… all those things wall street supposedly holds so dear.

    unless he’s been wickedly misquoted, i can only assume he’s getting some merciless teasing for his command economy mindset. (“i’m the elite. so where’s my elite house?”)

  • daveinbedstuy

    “Finance writer extraordinaire Felix Salmon”

    ROTFLMMFAO

  • dittoburg

    This guy is just shocked at the lifestyle that $350K buys in NYC. He was presuming a lifestyle it just won’t provide. Everyone earning less and hating him – just sour grapes and missing the point. His epiphany – comical.

  • daveinbedstuy

    BHO, you could have bought my house but it sold at 2.4% off the price I paid in 2007, arguably close to the peak.

  • Yes, these kind of whines are incredibly annoying. Not to mention that he lives in Cobble Hill, where the elementary school is excellent. One of the main reasons the nabe is so expensive now is that people with a few kids move there to save money by sending the kids to public school. Middle School might be more of a challenge but there are plenty of satellites if your kid is smart. Oh boo hoo, he can’t go to the country house so much. Alas! Some people actually have to go to Fairway to buy groceries instead of buying everything at Union Market. I have no sympathy. This is just obnoxious. He would probably be horrified to live in Queens.

  • cp

    well, the problem is that there isn’t enough decent housing, which is why the vacancy rate is unbelievably low. it they built more housing then prices would go down but they won’t so prices stay high.

    manhattans stratospheric prices ramp up brooklyns prices because we get the run-off. it will never go down appreciably unless the economy unravels.

  • minard

    I want to point out that Cobble Hill has a very high-performing public school.

  • Don’t forget uncle Sam takes about 50% of that 350K. After SS, Fed, State and City taxes the 350K ends up about 170K.

  • Don’t forget uncle Sam takes about 50% of that 350K. After SS, Fed, State and City taxes the 350K ends up about 170K.

  • daveinbedstuy

    “manhattans stratospheric prices ramp up brooklyns prices because we get the run-off.”

    Not only that, cp but still tens of thousands of people with huge gains (equity) in Manhattan 1, 2 and 3 bedroom condos that they have owned for years!!!! I think that’s the biggest sector that buys Brooklyn brownstones…when they want a bit of a change…more space, lower taxes, big yard!!!!

  • minard

    The trend I am noticing is people from Brooklyn moving back to Manhattan.
    Not vice-versa.

  • Come on, there is no way that after mortgage interest deduction and all other kinds of itemizing, etc. anyone like Schiff ends up truly paying half their income to taxes. Just because a large chuck comes out of one’s paycheck does NOT mean the government keeps 50 percent in the end. And I assume he’s got capital gains which are taxed at a much lower rate.

    • And let’s not forget that with marginal tax rates even if you hit an income where you are in a high tax bracket you are NOT paying that tax rate on all of your income.

    • Eh, at that income level he’s not going to have that much in capital gains. Capital gains rates are a subsidy for the super-rich, not the sort-of rich. Something like 70% of capital gains go to those who earn more than $1M a year. The way his income is described, I would presume his salary is $350k, so he’s not counting stock income or whatnot, if he has any.

      Still, after taxes he should have $250k or so, maybe a little less. Here’s a very nice lifestyle: $5k/month for a nice 3BR in Cobble Hill or Brooklyn Heights (assuming he has 2+ kids), for $60k/year on rent. $50k/year in other living expenses (food, entertainment, vacations, etc.). Send the kids to public schools, you’re in Cobble Hill for f*ck’s sake. $40k/year to illiquid assets like an IRA, 401k, etc. And $100k in savings towards a down payment.

      Four years later, he has $400k saved up (plus whatever gains he makes if he smartly invested that $400k) to make a down payment on a $2M townhouse or apartment. Or he could wait 8 years and have the $800k needed for a down payment on a $4M townhouse, which is the absolute top of the market outside of Brooklyn Heights (and gets you something very fancy even there). Of course, the monthly mortgage payments are then much higher than $5k in rent, but he has also doesn’t need to save nearly as much once he’s bought a nice house because each payment towards the mortgage is in essence the same as his previous savings towards making the down payment.

      This is basically my budget (I’m younger, so somewhat lower income and no kids yet, but same idea), and it baffles me how he could be so bad at budgeting. I know I’ll be able to afford a top-of-the-line home in Brooklyn in ten years; he should be able to afford one right now, or close to it.

    • Eh, at that income level he’s not going to have that much in capital gains. Capital gains rates are a subsidy for the super-rich, not the sort-of rich. Something like 70% of capital gains go to those who earn more than $1M a year. The way his income is described, I would presume his salary is $350k, so he’s not counting stock income or whatnot, if he has any.

      Still, after taxes he should have $250k or so, maybe a little less. Here’s a very nice lifestyle: $5k/month for a nice 3BR in Cobble Hill or Brooklyn Heights (assuming he has 2+ kids), for $60k/year on rent. $50k/year in other living expenses (food, entertainment, vacations, etc.). Send the kids to public schools, you’re in Cobble Hill for f*ck’s sake. $40k/year to illiquid assets like an IRA, 401k, etc. And $100k in savings towards a down payment.

      Four years later, he has $400k saved up (plus whatever gains he makes if he smartly invested that $400k) to make a down payment on a $2M townhouse or apartment. Or he could wait 8 years and have the $800k needed for a down payment on a $4M townhouse, which is the absolute top of the market outside of Brooklyn Heights (and gets you something very fancy even there). Of course, the monthly mortgage payments are then much higher than $5k in rent, but he has also doesn’t need to save nearly as much once he’s bought a nice house because each payment towards the mortgage is in essence the same as his previous savings towards making the down payment.

      This is basically my budget (I’m younger, so somewhat lower income and no kids yet, but same idea), and it baffles me how he could be so bad at budgeting. I know I’ll be able to afford a top-of-the-line home in Brooklyn in ten years; he should be able to afford one right now, or close to it.

    • Actually, the phase-out of deductions and the AMT increase your tax bill considerably. Add these taxes, medical and 401(k) payments, and I am confident his take home is in the neighborhood of $180-190. (Based on returns I have looked at for similar families). So he is taking home $15,000 a month. His rent is probably around $4,000-$4,500, which takes him to $10,500. Schooling is $2,750, which leaves him with $7,750. He should be saving at least 20-25% of take home (I would urge more than that), which is $3,000+, which leaves him with around $4,500 for food, entertainment, vacation, travel etc. One more kid in private school will bring that down to $2,000, which is still pretty decent lifestyle. Of course, if he wants the nice brownstone, he can do it, but the private school has to go.
      As to private school – don’t judge. There may be reasons for it we dont know about. His kid may have learning or social issues and require it. I know many people who need private school because of learning, social or religious issues/reasons. (I am guessing for him its a status thing…)

    • Once the AMT kicks in, you lose the benefit of the mortgage interest deduction, and some other deductions as well. Not impossible for the govt (fed, state and local) to take 50 percent, esp. if you’ve only got salary.

      • I see he rents. But actually, you do get the mortgage interest deduction. “Home mortgage interest claimed as an itemized deduction is only deductible for the AMT if the loan was used to buy, build or improve your home.”

      • I see he rents. But actually, you do get the mortgage interest deduction. “Home mortgage interest claimed as an itemized deduction is only deductible for the AMT if the loan was used to buy, build or improve your home.”

  • Come on, there is no way that after mortgage interest deduction and all other kinds of itemizing, etc. anyone like Schiff ends up truly paying half their income to taxes. Just because a large chuck comes out of one’s paycheck does NOT mean the government keeps 50 percent in the end. And I assume he’s got capital gains which are taxed at a much lower rate.

  • Gotta agree with serwardwasright: We make less than 200K/year, have two kids, and have a nice townhouse in Carroll Gardens. Didn’t trade up, it was out first purchase, we did a lot of renovating ourselves (someday we may even finish!) Rent out one floor, kids have tiny bedrooms, and go to public school. We’re happy.

    The main issue seems to be the hugely inflated expectations people have these days. If you look at a lot of post-war housing, families were perfectly happy to live in 1000 sq ft or less. If you want to have 3000 sq ft like new on a landmarked block in the slope or the heights, well yeah, 350K is gonna make you feel stuck. But if you are just a wee bit flexible, there are a lot of possibilities.

  • Gotta agree with serwardwasright: We make less than 200K/year, have two kids, and have a nice townhouse in Carroll Gardens. Didn’t trade up, it was out first purchase, we did a lot of renovating ourselves (someday we may even finish!) Rent out one floor, kids have tiny bedrooms, and go to public school. We’re happy.

    The main issue seems to be the hugely inflated expectations people have these days. If you look at a lot of post-war housing, families were perfectly happy to live in 1000 sq ft or less. If you want to have 3000 sq ft like new on a landmarked block in the slope or the heights, well yeah, 350K is gonna make you feel stuck. But if you are just a wee bit flexible, there are a lot of possibilities.

  • Ben Gazi

    Hey Schiff,
    I sell you my place for 2M CASH ONLY!

  • Ben Gazi

    Hey Schiff,
    I sell you my place for 2M CASH ONLY!

  • The problem with Schiff (well one of the problems) is that his whinning doesnt add up. If he makes 350k, realistically his take home is about 55% of that = 192.5k; then take 35K off that for Poly Prep (rounded up – there are always extra expenses) that leaves 157.5k for living. I dont know what he rents his place for (likely 3-4K a mo), if he has childcare for the 7yr old (what is moms deal?), parking/car but if you give him 8K a month for ‘living’ (which is really a pretty damn good ‘living’) he still has 5k a mo (60K a yr) for saving for a down payment (and lets be real his brother owns the co he works for – I am sure he could get a family loan for some of the downpayment). In 4 years he’d have a quarter of million dollars for a down payment plus 10k a month to fiance his house, save and live on (assuming both kids are in private school/college)
    Sorry but you could buy and live pretty good with that; even in Brownstone Brooklyn.

  • I think we should all chip in and buy this guy the brownstone he deserves. And then chip in some more to put all three kids in a private school that’s even more private and even more expensive than the one they’re in already. Who’s with me?

  • daveinbedstuy

    fsrq, you left out the summer rental.

  • rbcg, can I ask when you bought your home? It’s near impossible to find a townhouse in CG, or any other part of BS Brooklyn for less than one million today. I know, I’ve been trying for years now. Above one million is out of reach for those earning less than 200k in income, with or without kids. Some people don’t realize how much townhouse prices have exploded over the last two years.

    Seward, do you mean BED sty? You can’t possibly expect Andrew Schiff to live there!

    • ditto. I can’t find decent housing for under $1 million. By decent I mean having reasonable square footage, some very modest storage, and some outdoor space. Fixer-uppers are priced about $10K less than mint-condition properties, despite needing $100K worth of work.
      that said, I have not been out to Bed Stuy. DIBS’ house is one of the VERY few properties I’ve seen that actually seems to make financial sense to buy.
      Instead of begrudging Schiff a summer rental (something his working-class, carpenter grandfather had, and no one begrudged HIM some family vacation time), we should be arguing instead that ALL of us should be having a better life. I would rather bring us all up than drag someone better off down. Time off with your family in the summer is basic, and shouldn’t be considered an extravagant luxury (please, they’re driving, not flying), but instead it should be something that is accessible and attainable for everyone.
      My heart doesn’t bleed for Schiff, one bit. But to want to drag everyone else down to subsistence level, instead of raising what subsistence level is, is counter-productive for all of us.

      • dnk

        noob, you might want to check out Bed Stuy. I found a nice brownstone with a lot of original detail on a very pretty block (lots of trees, well maintained properties, etc). It was just under 500K, and we put another 125 into it to get it where we wanted. All your requirements: reasonable square footage (I think: ~900 sq/ft per floor, 3 floors not counting cellar), outdoor space, storage.

      • dnk

        noob, you might want to check out Bed Stuy. I found a nice brownstone with a lot of original detail on a very pretty block (lots of trees, well maintained properties, etc). It was just under 500K, and we put another 125 into it to get it where we wanted. All your requirements: reasonable square footage (I think: ~900 sq/ft per floor, 3 floors not counting cellar), outdoor space, storage.

      • Per my original post: depends on what you mean by decent. Our place is 17 X 42, we live (4 of us) on the top 2 floors of a three floor house. Like I said, kids have tiny (like 8 X 10) bedrooms, but it works. Granted, it was rare two years ago, and may be impossible now, but we did actually have a bid on another house in CG at the same time.

    • A townhouse for under $1m? I did it. The last few feet of Park Slope, right by the Prospect Expressway. 3-family brick townhouse. I live on the first floor, my friend/co-owner lives on the second, and I rent out the third. After a reno of the first floor (under $50k), I’ve got around a nice little apartment. Next year the basement gets renovated and we’ll have a bit more space.

      I can hear the highway from my living room, but I’ve got a huge yard and very, very low housing expenses.

      It can be done, you just need some creativity and the ability to make compromises.

      • Zoddie, I’ve looked specifically in that area. A brick 3-family in south slope? Ain’t gonna happen. Maybe 2 years ago. Maybe even 1. But not today. I’ve seen a few that need $300k+ in renos that are still hovering around the $1M mark or more. This is what I mean when I say people who are already home owners don’t realize how much the market has exploded. Even 12 months ago was a completely different market.

    • Sorry for the late reply: bought for under 1M in 2010. We looked for years two – they’re rare, but they’re out there (or were two years ago.) Gotta be willing to renovate, though.

  • daveinbedstuy

    workerb, have you been to Bed Stuy?? It’s really nice in a lot of spots, especially around Stuyvesant Ave. I just sold my 3 storey, 2 family, fully renovated with deck for $800k

  • Whatever you think of the guy this is a hilarious:

    “Finally, Schiff says the original Bloomberg story was slanted. When he said “I feel stuck,” Schiff says he was referring to a specific incident involving a major traffic jam, not a commentary about his bank account.”

  • Whatever you think of the guy this is a hilarious:

    “Finally, Schiff says the original Bloomberg story was slanted. When he said “I feel stuck,” Schiff says he was referring to a specific incident involving a major traffic jam, not a commentary about his bank account.”

  • Havemeyer

    I will not comment on his plight, but I predict the family will move to Montclair, Maplewood or a river town in the near future…

    … at which point he will whine about property taxes.

  • daveinbedstuy

    BHO, probably quite a while ago while you were whining that prices should come off by half!!!

  • I heard this guy interviewed on WNYC, and he back-pedaled a little on the original “just getting by” statement. He said that he and his family where more than comfortable, and had everything they needed, but that when he entered financial services, he thought that he would have a grander lifestyle. I remember a random quote from a Wall Streeter in the 90s about to collect a $1 million bonus: “A million dollars ain’t what is used to be”

  • wasder

    I certainly know people who fit the financial mode of this guy and who have similar complaints, but for me its a matter of being realistic. Does that salary level get every single lifestyle chip one could possibly hope for? No. Can you live well in Brooklyn for that kind of money? Of course. It really depends on what you prioritize and what you can compromise on. In this day and age if you are clever you can get your children into pretty damn good public schools whether they are your zoned school or not. For me the idea of private elementary school is a waste of money, but that is a choice I have made. And buying in Clinton Hill instead of trying to buy in the Slope or Cobble Hill is another choice I made to fit my budget level. I just can’t believe this guy was so unabashed about saying you can’t live in Brooklyn on his kind of money. Makes him sound tres clueless indeed.

  • brownstoneshalfoff

    And rcbg shouldn’t have to skimp on bedrooms for Pete’s sake. Whether single 3-storey or triplex over 1, the kids should get the whole facade width (front or back). He/she must be giving up two or more floors. Then you have the risk of nonpayment of banked-on rent (a squeeze for most).

    This hyperinflation in RE we’ve experienced has not yet “corrected”, or as I prefer, resumed it’s collapse. 3 x income = 3 x 350 = a mil therebouts. Say 1.5. Half off for Cobble Hill. And that’s being generous with the median income and normal appreciation.

    ***Half Peak Comps Euroding***

  • brownstoneshalfoff

    And rcbg shouldn’t have to skimp on bedrooms for Pete’s sake. Whether single 3-storey or triplex over 1, the kids should get the whole facade width (front or back). He/she must be giving up two or more floors. Then you have the risk of nonpayment of banked-on rent (a squeeze for most).

    This hyperinflation in RE we’ve experienced has not yet “corrected”, or as I prefer, resumed it’s collapse. 3 x income = 3 x 350 = a mil therebouts. Say 1.5. Half off for Cobble Hill. And that’s being generous with the median income and normal appreciation.

    ***Half Peak Comps Euroding***

  • My heart bleeds. Please. I work in publishing, not exactly a field you get into in order to make money hand over fist and we managed to save and make smart choices and own our own home. But it takes time and determination (buying properties that need renovation, trading up, etc.) which I suppose is like speaking a foreign language to someone in the instant-gratification world of finance.

  • My heart bleeds. Please. I work in publishing, not exactly a field you get into in order to make money hand over fist and we managed to save and make smart choices and own our own home. But it takes time and determination (buying properties that need renovation, trading up, etc.) which I suppose is like speaking a foreign language to someone in the instant-gratification world of finance.

  • As two working parents together, we make about half what this guys makes, but we bought a small brownstone in the fringes of a nice Brooklyn neighborhood which we fixed up. Granted, we were trading up but that’s because we always have made very modest incomes so did not have the capacity – which this guy does – to save big bucks toward down payment, but we saved what we could and looked for a long time to find a house we could afford to buy and renovate, with rental income to cushion us. We live frugally – our kids are in public school, we eat out rarely, bring our lunch to work, no regular “date” night, no fancy vacations or summer home. And we feel very fortunate to have what is a good life in a great city. No mention of the guys wife (or partner), by the way – does that person work or stay at home with the kids? Childcare is another huge cost in this city but we also pay our sitter well with paid sick days, vacation, etc. I think this guy has really poor budgeting skills and/or values and feel lucky that my parents taught me the value of using money wisely and not getting too caught up with keeping up with the Jones – a dangerous game in the upper echelons of NYC.

  • Um, when u make over 250, almost half of your income goes to taxes — if you include NYC, State and Federal…. Not to mention capital gains… The guy is not trying to say ‘boo-hoo.’ He’s just pointing out that its darn expensive out there. It’s $5k a year just to park a car in The Heights or CH. A lot of what he said was taken out of context. That’s all I’m saying. He was had. Totally slapped.

  • let me cry these rich self entitled douches a river.

  • let me cry these rich self entitled douches a river.

  • what type of crack are you on they aren’t middle class at all. with that much money you could move a little bit in and live like a king.

  • I’m not going to defend the guy, since we make do on substantially less than he does, but I think most of us who live in NY DO understand the feeling that money just doesn’t go as far in NYC as it does elsewhere. When I look at stats, based on income and education, I’m on the fringes of upper middle class, but I have to live frugally if I am to get by and have enough for retirement. And that’s not even taking into account the “Keeping up with the Jones’ stuff!”

    My parents had more with less. Go figure.

  • I am surprised you would so fundamentally miss the point when saying, “of course anyone who makes significantly less than that is going to think the guy is a douche bag for complaining.”

    To the contrary, many people who make significantly MORE than Mr. Schiff think he is a douche bag for complaining.

  • gotta love the first world self entitle elite problems.

  • gotta love the first world self entitle elite problems.

  • Well, yes, money goes a lot less far here. For example, our renovation cost, for us, a fortune, and yet we were frequently told we were getting an incredible deal in NYC. And indeed, having researched reno costs, it’s true that they are shockingly high here in NYC. I have family in the Bay Area which is also expensive, but not as bad as NYC. And of course, it’s endlessly frustrating to a lot of New Yorkers that a 2-bedroom apartment in a good neighborhood with strong public schools, public transport access etc costs as much as a 5-bedroom home in many other parts of the US (and not the boonies – I’m talking Montclair for example). But I still think this guy’s numbers don’t quite add up, or at the very least, he has made certain choices such as fancy summer home and private school, where instead he could be making other choices and not feel so “stuck”. As for public vs. private quality, there are obviously strong and different opinions on this, but the public school my kids attend has a real mix of families of very modest means and families affluent enough to afford private, but who for many reasons prefer public. As with other articles bemoaning the problems of the fortunate, there is a grain of truth in this – New York is expensive – but there are so many people who find creative ways to live their lives happily in NYC and yes, even purchase decent real estate, without making tons of money.

  • Well, yes, money goes a lot less far here. For example, our renovation cost, for us, a fortune, and yet we were frequently told we were getting an incredible deal in NYC. And indeed, having researched reno costs, it’s true that they are shockingly high here in NYC. I have family in the Bay Area which is also expensive, but not as bad as NYC. And of course, it’s endlessly frustrating to a lot of New Yorkers that a 2-bedroom apartment in a good neighborhood with strong public schools, public transport access etc costs as much as a 5-bedroom home in many other parts of the US (and not the boonies – I’m talking Montclair for example). But I still think this guy’s numbers don’t quite add up, or at the very least, he has made certain choices such as fancy summer home and private school, where instead he could be making other choices and not feel so “stuck”. As for public vs. private quality, there are obviously strong and different opinions on this, but the public school my kids attend has a real mix of families of very modest means and families affluent enough to afford private, but who for many reasons prefer public. As with other articles bemoaning the problems of the fortunate, there is a grain of truth in this – New York is expensive – but there are so many people who find creative ways to live their lives happily in NYC and yes, even purchase decent real estate, without making tons of money.

  • if you move farther into the borough it gets cheaper and cheaper!! still in Brooklyn, but you people who agree with the guy, just want to live the millionaire life style.

    where i live is safer than some of the areas like park slope or bococa etc… and its tons cheaper. but you guys will never travel this far in.

  • daveinbedstuy

    If he’s marketing for a fund then he’s getting juicy commissions. Not some schlepp marketing job for Pringle’s or something

  • expert_textpert

    “Schiff said. “I’m crammed into 1,200 square feet. I don’t have a dishwasher. We do all our dishes by hand.”

    My advice to him is to get rubber gloves and to STFU.

  • workerb: I think the key issue here is “needs 300K in renovation”. I know people say a total gut is 100K per floor, but we looked at dozens of houses over the years we were house-hunting, and rare was the house that needed a total gut – at least as far as we were concerned. Living in a 125+ year old house, I’m OK with having doors that stick and stairs that creak and bathrooms with exposed pipes. That may not be your thing, but if you can live with it, renovations can be a hell of a lot less than what a lot of people on this site seem to think is “necessary.”

    • I’m 100% with you. My husband is in the biz and can do most cosmetic (and some structural) work himself. But everything I see is either being touted as “move in” (and therefore $1M+) or is a complete gut. There is almost no discount for something that needs cosmetic work, and only a small discount for something that needs a gut.

      We once had an accepted offer on a place for $900k that needed a complete gut. We were ok with just doing musts (electric/plumbing) and then saving all the cosmetic stuff for later or doing it ourselves. But luckily we had a PE check the place out as a favor and found it was falling apart – quite literally.

  • People in this thread have some very odd deals of a comfortable mortgage for an income of $350k. Financial experts would say no more than a million for sure, so I am not sure how a guy like this could save 400k and somehow suddenly be able to afford a $2million+house. Not going to happen. That is how our economy got into this mess, this guy may be complaining but at least he his being real about what he can and cannot afford unlike the millions of people who weren’t

    • Advice is irrelevant in NYC, where property taxes on townhouses are close to zilch. Also, the standard lines (no more than 2-3x income in housing costs) become increasingly irrelevant as your income increases. They’re mostly guidelines for people making $50k or so, the middle class. If you are wealthy, you can afford to spend a much larger portion of your income on your mortgage as your other costs (food, entertainment, schooling, etc.) don’t or shouldn’t increase much as your income rises.

  • agree that this guy comes off sounding like a clueless entitled brat. He’s got many options besides buying a single family in prime brownstone Brooklyn – including a house in a less prime neighborhood, moving to the burbs and what about just buying an apartment? Plenty of 3 BRs (with dishwashers!) that you could afford on a $350k income if you were even modestly frugal and saved some money over the years.

  • rf

    According to the original article, his older kid is at Poly Prep and he expects to send his younger there later–maybe high school? So, Mr. Brownstoner, you can dry the tears on that hankie–no need to cry for this guy, who sends his younger kid to an excellent public school in Cobble Hill.

  • I know what workerb is talking about. We’ve been looking at houses on the fringes of PS for a while and keep seeing the same unattractive choices for a million-plus. Much more attractive are the 3-br coop apts in the 800-900 range in classic PS locations–there seem to be a number of those available. T

  • People who wanted to live in neighbors like Carroll’s Garden, Park Slope, Cobble Hill, etc…are not only because they were attracted by nice brownstones and townhouses in the area. There are also other things play into consideration such as amenities like easy access to Manhattan, good public schools, restaurants and shops. For the same reason why people willing to pay such high rent to live in Manhattan.
    Yes, housing further in Brooklyn is more affordable, at least for someone making 350K. But that means one has be willing to giving up some of that conveniences. But, if one does decided to live in one of those neighbors then some sacrifices are needed. Sending 2 kids to private schools and 1M+ mortgage (a decent single family townhouse cost around 1.5M) will not be easy with 200K take home.

    Don’t get me wrong, 200K a year to take home still a lot of money and definitely can live comfortably in brownstone Brooklyn but, one just have to be realistic about what that budget can actually support.

  • re: cobble hill school– everyone assumes ps29 but much of cobble hill (part closest to brooklyn heights) is zoned for philip livingston on dean/pacific near hoyt…still fine school but not to be confused with ps29.

    Also – if read entire bloomberg article….jist is very easy to leave beyond your means no matter how much you make.

  • Okay folks. I am a bonafide one-percenter and for 2011 I made something like what our subject makes, though for me, it is more of a low point, than a norm. I am used to making somewhat more. But I can attest to the fact that, after Fed/State/City taxes, after FICA, insurance, 401K contributions, etc, that take home would be around $200,000. I can also confirm that, while it is certainly not an amount to be sneezed at, that for me and my household, it represents a certain amount of belt-tightening, actually a lot of belt-tightening, and no, we really don’t feel like we live high on the hog. Our lifestyle is not all that different from many of our non-NYC friends making substantially less.

    I am (unlike the subject) a Park Slope brownstone owner, but I got in several years ago, and rolled the equity from a co-op sale into the down-payment and reno costs. Still there’s the big mortgage. And then it costs a lot to insure and heat an antique home. And then there’s the fact that I work just about 24/7 and can’t do a lot of stuff myself, so we have to hire people to repair, clean and maintain the place.

    Here’s the basic problem with my pal’s situation. He ramped up his lifestyle far too quickly, with the expectation that his income was going to grow to match the life to which he (and by default his family) have become accustomed. A lot of people made that assumption pre-2007. He got caught in a “squeeze” as we like to say in the business. He zigged, when he should have zagged. It’s understandable to the extent that him, and many like him took it for granted that trees grow to the sky. Let he or she among us who is truly without sin cast the first stone.

    I’m old enough now (but not very old) to have seen a couple of cycles on the street. I learned a long time ago that the high income also comes with what we call “income volatility”. Our pay is geared. Which is to say, when it’s good, it’s f-in good. And when it’s bad, it can get pretty nasty. So I learned a log time ago (with the help of my trusty mate and fiscal auditor) to live somewhat below my means, and actually bank some of that loot.

    My pal is a slow learner.

  • please, no “it’s fine but” remarks about ps 261. My daughter goes there and it’s completely AWESOME. Amazing teachers, warm environment, and–need I say more–Carmelo the science Fellow. The main difference between it and ps 29 is that it actually has a few minorities in the mix (horrors!) vs. the pretty much ALL white ps 29. . . . The diversity factor seems to scare away a certain type of uptight Cobble Hill parent. (Maybe Mr. Schiff?) But my feeling is–good, let them go. Who wants those type of families in the school anyway. . . .

  • I wasn’t putting down ps261 – just sayin’ not the status of ps29.
    and that lot of cobble hill is zoned for ps261 not ps29.