LATEST NEWS

New Orleans Ranks As One Of The Most Unaffordable Cities In America

Turns out the Big Easy’s not so easy if you’re looking for a place to live.

By Jeff Vasishta December 21, 2016
Credit: Chris Litherland

Turns out the Big Easy’s not so easy if you’re looking for a place to live. In fact, according to a study conducted by Apartment List, which evaluated data between 2005 and 2015, New Orleans ranks alongside New York, Los Angeles and San Diego as being one of the least affordable cities in America. N’Orleans, the new Brooklyn, Who knew?

Nearly 57 percent of renters in the New Orleans Metro area reported they were burdened by rent cost with various factors contributing to the dramatic increase. Firstly, since Hurricane Katrina, the average price of a house in New Orleans has climbed a stunning 46 percent. Demand in the older parts of the city like Uptown, Bywater and Magrini have skyrocketed, meaning that many buyers wanting to live there have been priced out and have been forced to rent.

Related: Chicago’s $1 Lot Plan—And Why It Is Different From Those That Have Come Before

Wages haven’t kept parity with the house prices and rents. The latter increased by 18.6 percent in the decade after Katrina while renter income only increased 14.6 percent. Also, post millennials are delaying getting married or having fewer children which has meant they have also delayed the home buying process and increased the number of rental properties needed. Lastly, more than 7 million homeowners went into foreclosure during the financial crash of 2008. If only half of those who went into foreclosure went on to become renters, the demand for rental housing would have increased by 10 percent in a short period, pushing up prices.

Nola.com conducted its own survey and discovered that the average New Orleans family spends around a third of their income on rent which is also true for a third of the major metro areas in the US. However, New Orleans has been particularly hard hit because of the downturn in the oil and gas industry and the capping of the film tax credit has caused jobs to move elsewhere.

“We’ve only been up for a few years – we’re due to flatten out and go down a little,” real estate appraiser Wade Ragas said. “That’s a little oversupply condition and that will put downward pressure on price, downward pressure on rents and things will stay on the market a little bit longer in some of the neighborhoods.”

With the federal reserve raising interest rates, a trend which may continue, the cumulative effect has been a continued cooling of house buying. If jobs aren’t there for people to pay rent then a correction could look to be on the cards. The kind that New Orleans will need to make it affordable, though is still a long way off.

 

Jeff Vasishta

ABOUT THE AUTHOR Jeff Vasishta

ABOUT THE AUTHOR Jeff Vasishta

Jeff is a writer, husband and father but not necessarily in that order. As a music journalist he counts Prince, Beyonce and Quincy Jones amongst those he’s interviewed. He's also owned and flipped homes in Brooklyn, NJ, CT and PA.

  • AGORAFY
    Stefano Boeri, the architect mastermind behind the famous plant-covered skyscrapers, is now designing Forest Cities in Liuzhou, China. #ForestCity #China https://goo.gl/PsTUwv
  • AGORAFY
    Auction is the second scheduled in a month for a One57 unit and it could set a NYC foreclosure record. #BillionairesRow #Foreclosures https://goo.gl/NZ3zqD
  • AGORAFY
    Once a couch-surfing website, Airbnb moves on to luxury properties, further disrupting hospitality industry. #Airbnb #Luxury https://goo.gl/7TpLk6
Four Countries To Retire In With $200K In Savings—And How Much Real Estate Costs There
Ever dreamed of retiring abroad? You know, affordable healthcare, better climate, more positive news—becoming an expat seems like an enticing option, especially one you no…
While Other Real Estate Platforms Start Charging Agents $3-Per-Day Exposure Fee, Agorafy Remains Accessible To All
Real Estate searching platform are always finding news ways to diversify their revenues models. Case in point—on Tuesday July 18, Streeteasy, one of New York…
Is Real Estate Crowdfunding The Fix That Urban Housing In America Really Needs?
Saving money for a down payment? One can only hope. Most millennial in their twenties or thirties are mortified that they might never be able…
Brooklyn And Queens’ Real Estate Sub-Markets Continue Their Ascent To The New Heights
So, the sales prices in Brooklyn and Queens hit record highs. Again. Just like they did in December 2016 and at the end of this…
The Economy Of Car Services And Delivery Apps Might Be Making NYC Less Eco-Friendly
Living in an eco-friendly neighborhood is a good thing. And, as it always the case with the good things, it also costs more. High rents…
Building Communities: What The U.S. Developers Should Learn From Soho China
As our world emerges into the new period of globalization and technology, some of the most important by-products of this process are buildings that have…
Five Reasons Why All Entrepreneurs Must Keep Their Eyes On China
It is hard to overestimate the importance of Chinese influence on the modern global economy. Carving out a place in Chinese market and winning over…
Airbnb Up Their Game With A New Luxury Tier Featuring Mansions And Villas
Airbnb is about to seriously up their game. First, the company started testing a new service called Select in an attempt to push accommodation listings…