Affordable Family Formation For The Few
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With the decline in crime, Manhattan is turning back into paradise for families — for the tiny handful who can afford it. Via Half Sigma, from the NYT:

Since 2000, according to census figures released last year, the number of children under age 5 living in Manhattan mushroomed by more than 32 percent. And though their ranks have been growing for several years, a new analysis for The New York Times makes clear for the first time who has been driving that growth: wealthy white families.

At least half of the growth was generated by children who are white and non-Hispanic. Their ranks expanded by more than 40 percent from 2000 to 2005. For the first time since at least the 1960s, white children now outnumber either black or Hispanic youngsters in that age group in Manhattan.

The analysis shows that Manhattan’s 35,000 or so white non-Hispanic toddlers are being raised by parents whose median income was $284,208 a year in 2005, which means they are growing up in wealthier households than similar youngsters in any other large county in the country.

Among white families with toddlers, San Francisco ranked second, with a median income of $150,763, followed by Somerset, N.J. ($136,807); San Jose, Calif. ($134,668); Fairfield, Conn. ($132,427); and Westchester ($122,240). In comparison, the median income of other Manhattan households with toddlers was $66,213 for Asians, $31,171 for blacks and $25,467 for Hispanic families.

Keep in mind that $284k is the median income of white parents of toddlers, not of teens. I would extrapolate that Manhattan parents of teens going off to college have a median income of somewhere around a half million per year.

You can see how the 1990s fall in crime, which was much sharper in Manhattan that just about anywhere else in America, set off a virtuous cycle (virtuous from the perspective of the extremely wealth), making Manhattan ever more desirable and thus ever more expensive, which in turns drives out more and more of the nonwealthy from south of Harlem, leaving inside traders as the only criminals who can afford to live in most of Manhattan.

By the way, this reminds me that the media routinely gives an unrealistically lowball sense of just how much money it costs to live in the more fashionable parts of the country. It's common for personal business and advice articles in the press to give the impression that making $100,000 per year would be the solution to all your financial problems, when it's just enough to introduce you to a whole new world of problems.

Is the cost-of-living variance among places within this country greater than in the past? It sure seems that way, but I've never seen a study of it.

[Crossposted at]

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