Mausam Bhatt Chief Product and Technology Officer | realtors.com
A recent report from Realtor.com highlights the challenges faced by minimum-wage workers in New York City as they strive to afford housing in one of the most expensive rental markets in the country. According to the report, a minimum-wage earner would need to work 106 hours per week to afford rent in Manhattan, with other boroughs offering only slightly less demanding requirements.
Brooklyn requires 89 hours of work at minimum wage, Queens demands 80 hours, and the Bronx, while more affordable, still necessitates 75 hours. These calculations are based on renters spending 30% of their income on housing and sharing costs with another person.
"Living in New York City presents a significant challenge for minimum-wage earners," stated Jiayi Xu, an economist at Realtor.com. The city's median rent has increased by $85 over the past year to reach $3,362 across its major boroughs—nearly double the national median.
Despite higher average salaries in New York City compared to national figures, many residents find it difficult to meet rental costs. Xu noted that "to afford a typical rental unit at the current minimum wage without exceeding a standard 40-hour workweek, a renter would need to share the cost with three other people."
The report's data is derived from analyzing how many hours per week a worker earning New York City's minimum wage of $16 per hour would need to work to cover typical rental expenses. Even with an upcoming increase in minimum wage to $16.50 per hour scheduled for 2025, significant relief seems unlikely.
"The minimum wage would need to rise to $32.33 per hour—more than double the current rate—for a worker to afford a typical rental with just one additional roommate," Xu emphasized. This highlights what Xu described as "the severity of the rental affordability crisis facing low-income groups in NYC."
Manhattan's market shows signs of cooling despite remaining costly. In November 2024, Manhattan's median asking rent was $4,395—a slight decrease from previous levels and marking ongoing annual declines.
"It marked the 17th consecutive month of annual declines," Xu pointed out, noting that rents have fallen by $206 since pre-pandemic times and are now $456 lower than their peak.
To comfortably afford renting in Manhattan without exceeding budgetary constraints on housing costs, "a gross household income of $14,650 per month or $175,800 per year is required," according to Xu.
In contrast, Queens has become increasingly attractive due to its relatively rapid growth in rental prices combined with its cultural appeal and proximity to midtown Manhattan. The median asking rent there reached $3,333—an increase of 8.6% from last year.
Brooklyn also saw rent increases but at a slower pace compared to Queens. Its median asking rent rose by 1.7% annually reaching $3,694—demanding an annual income of approximately $147,756 from renters seeking accommodation there.
Meanwhile, The Bronx remains New York City's most affordable borough despite rising rents posing challenges for locals; here renters must earn around $124,560 annually based on current rates.
Overall trends indicate smaller units have grown more popular among those seeking affordability; these have experienced significant price hikes over larger apartments which saw lesser demand shifts recently reported by Realtor.com analysts like Jiayi Xu who observed: "The median asking rent for 0-2 bedrooms...reflecting an increase...while rent for three-plus bedroom units declined."
Alerts Sign-up