Congrats, young intern! You've finished your grueling professional degree in architecture, and now it's time to look for your first full-time job in the business, rent an apartment, and become very close friends with NCARB as you log your hours and study for the registration exams.
In the spirit of my previous thread, here are your housing options in the same 15 cities, based on the following assumptions:
1) You're making the average annual base pay for an Intern 1 according to the 2015 AIA Compensation Report. Statewide figures are used if numbers for a specific city aren't available.
2) Any overtime pay, if you're lucky enough to get paid overtime, is not included in your housing budget.
3) You're single with no kids, and don't want to live with roommates.
4) Your maximum monthly rent is based on 1/36th of your annual gross pay in all cities except New York, where landlords typically require your salary to be at least 40 times your monthly rent. Security deposits and any broker fees are not included.
Chicago, IL Annual Base Pay: $38,600 Max. Rent: $1072
Shown here: Studio / 1 bath, Lincoln Park Commute time: 29 minutes (Red Line subway to State / Madison)
(This place is a little special to me, as it was where I got my first apartment as an undergrad, after leaving my parents' house in the suburbs. I paid $485 a month here for a studio in 1996. Sometimes the hot water and elevators even worked. Also, everybody in Chicago apparently has a friend who used to live in this building.)
Biggest surprises: the pathetically small amount of money you make in NYC compared to the cost of housing. You can make more money in Minneapolis or Atlanta, and apparently live like a normal human being. Although Seattle has high rents, it's a much better situation if you're renting here vs. buying.
My next and final installment in this series: You've finally become a principal and have married somebody who makes roughly the same amount of money, and you're looking to buy a place. Stay tuned.
Rusty!
May 12, 17 9:50 pm
Your posts are fun, but these numbers appear waaaay off. What you list as base salary for NYC was like that like 15 years ago. Your other post on Managing Principals also seems very low. Senior Associate perhaps. But even then, general rule on housing is 3x max house cost of annual income. You are way over 5x on most of those. Also, are there more than 10 registered architects in Asheville?
David Cole, AIA
May 12, 17 9:58 pm
As I mentioned in the OP, the numbers are taken directly from the 2015 AIA Compensation Report. If you think they should be different, take it up with the AIA.
David Cole, AIA
Mar 18, 17 10:26 pm
Also, a note about San Francisco's BART system and your transportation budget:
Most transit systems offer an unlimited-ride monthly pass that usually ranges about $70-100. In New York City it's about $115 and includes unlimited rides on the subway and buses throughout the city. Many employers include a transit pass as a perk, or at least let you buy a discounted pass on a pre-tax basis.
You're not so fortunate if you live way out in the Bay Area suburbs and commute into the city on BART each day. BART's fares are distance-based, and no monthly pass is offered. A one-way fare on BART from Richmond to Montgomery Street is $4.65. Multiplied over an average of 22 workdays per month, that's $204.60 in BART fares.
And since you're living way the hell out in Richmond, you probably also need a car for getting groceries, running errands, etc. The average cost of car ownership is $8698 per year, or $725 per month. So that adds up to about $930 in monthly transportation costs if you live in a Bay Area suburb and commute to work on BART in the city.
geezertect
Mar 18, 17 11:00 pm
These two threads are great. They sure make Asheville look like a great place to land after graduation. Cool craftsman style apt when young, and beautiful two story colonial when at mid career. As far as the other cities are concerned, there isn't much of an improvement in life style after 15 years or so in the profession. Pretty demoralizing.
David Cole, AIA
Mar 19, 17 12:45 am
I hated Asheville when I lived there as a kid, but I'd probably appreciate it much more now.
In the part of town where I lived, my best friend's back yard was adjacent to the property of noted landscape architect Doan Ogden, and me and my friends spent many hours exploring the extensive network of immaculately landscaped trails throughout the woods on his property, and we were even invited inside his nice mid-century house a couple times. I'd buy that property and move there in a heartbeat if the opportunity presented itself.
I'm guessing architecture jobs in Asheville aren't exactly plentiful, though, right?
David Cole, AIA
Mar 19, 17 12:45 am
I hated Asheville when I lived there as a kid, but I'd probably appreciate it much more now. In the part of town where I lived, my best friend's back yard was adjacent to the property of noted landscape architect Doan Ogden, and me and my friends spent many hours exploring the extensive network of immaculately landscaped trails throughout the woods on his property, and we were even invited inside his nice mid-century house a couple times.
Why wouldn't you want to live with roommates? I've had so much fun with all my roommates ever since college. And of course the plus is I've always lived walking distance to the beach and never paid more than $750/mo
David Cole, AIA
Mar 19, 17 12:36 am
Not everybody wants to live with roommates. I've had some great roommates and some truly terrible roommates over the years, but it shouldn't be the default living arrangement for a professional with an advanced degree if it isn't desired.
archi_dude
Mar 19, 17 1:57 am
I agree but it's not about how advanced your degree is, you could have a doctorate in some angry studies and it wouldn't guarantee financial success. The question is are you providing value with your degree? A good looking functional building is great but honestly I feel as though most architects and drafters can achieve that. Are you providing a good looking functional building on a faster schedule, with less litigation and snags for a more economical price than another architect or a contractor with design services? If yes, then yeah you can charge for it. If not, then you are selling design skills only, thus, your services will remain a luxury expense and not a value expense and you will need to accept the fact that earning a middle class salary for a mostly art based service is pretty good.
archi_dude
Mar 19, 17 2:10 am
I guess a less long winded response is dude, an intern is making 44k/yr painting sketch up models vs. business majors getting sucked into a black hole of excel spreadsheets, or enterprise rent-a-car "management" or cold call sales. Life ain't that bad.
archi_dude
Mar 19, 17 2:10 am
I guess a less long winded response is dude, an intern is making 44k/yr painting sketch up models vs. business majors getting sucked into a black hole of excel spreadsheets, or enterprise rent-a-car "management" or cold call sales. Life ain't that bad.
David Cole, AIA
Mar 19, 17 2:15 am
I'm not sure what you're on about, but in roughly ten out of my 15 examples above, it's perfectly possible to have a reasonable quality of life on an intern's salary without living with roommates. If you want to see the difference having roommates makes in the other five cities, feel free to do your own research and post your own thread.
x-jla
May 12, 17 10:17 am
I could never have roomates. I require privacy and solitude or my brain starts to malfunction.
gruen
Mar 19, 17 6:58 am
Great thread! Thanks David.
Josh Mings
Mar 19, 17 1:03 pm
David - I dated someone that lived in the Chicago building.
poop876
Mar 20, 17 8:55 am
David,
my first condo was across the street from 444 St. James. I know quite a few people that lived in that building. I probably ran into you at some point on the street if not at Tin Lizzie! I loved living on that street!
David Cole, AIA
Mar 20, 17 10:23 am
Small world... I never hung out at Tin Lizzie, but when I wasn't flat-broke I was a regular
David Cole, AIA
Mar 20, 17 10:25 am
Small world... I never hung out at Tin Lizzie, but when I wasn't flat-broke I was a regular at a few other neighborhood spots like the Pasta Bowl, Granny's Pancake House up on Diversey, and the Duke of Perth. I have no idea how many of my old haunts are even still in business... Most of my favorite spots in Wicker Park have long since vanished.
senjohnblutarsky
Mar 20, 17 11:07 am
I went much smaller with my entry level job. I made less, which by these numbers would put me in the $972 range. I lived in a 1300 sf 2br, 2 bath, apartment that would leave me $222 after rent. There were much cheaper places that could be had as well.
There are definitely benefits to going small. Definitely drawbacks... since there are no firms in my area anymore.
David Cole, AIA
Mar 20, 17 12:15 pm
My final follow-up thread: Housing Options for a Managing Principal. As with the other two threads, these show what you hypothetically could buy under certain circumstances, not necessarily what you should buy.
bowling_ball
Mar 20, 17 12:22 pm
I've been kind of thinking that these are all 'could' and not 'should.' None of these options leave any real money left over at the end of the month. Importantly, you're not accounting for student loans, which eat up a significant portion of income for many graduates (and even licensed architects!)
David Cole, AIA
Mar 20, 17 12:47 pm
I assume a certain amount for monthly debt payments in the two scenarios, which could include student loans, car payments, credit card payments, or other debt. The purpose of the exercise was to compare options across a variety of cities, not necessarily to account for everybody's particular situation.
David Cole, AIA
Mar 20, 17 12:48 pm
I would strongly encourage people to use the links provided, make their own budget and do their own research, and take into account their own specific needs and financial situation before making any life decisions based on these threads.
bowling_ball
Mar 20, 17 11:32 pm
Well of course. And it's interesting stuff, although I don't think it stands up to real world scrutiny. When I made this range of salary, my apartment was half of the cost of those shown here, and I didn't exactly have a lot of extra cash left over. It might be a difference in countries though - my loan payments are 5.3% over 10 years, and I'm sure I pay more income and sales tax than most US states.
x-jla
May 12, 17 10:13 am
All one br or studios...if you have kids the costs jump up alot.
David Cole, AIA
May 12, 17 9:56 pm
Most entry-level architects fresh out of school aren't yet making babies. I'll say it again for the people in the back row:
The purpose of the exercise was to compare options across a variety of cities, not necessarily to account for everybody's particular situation.
x-jla
May 13, 17 4:09 am
Well, if you did a deeper study you would find that the income-living expense gap, between places like NY and Asheville, widens enormously as apt size and br count increases. It would make a stark graph. It would be impossible for a parent (which from what Ive seen makes up about 1/4 of grad students) to live in NYC and afford a 2 bedroom, daycare, student loans, etc. As I've said before, this is why the demographics of the profession closely align with the demographics of privilage. This system is broken.
x-jla
May 13, 17 4:11 am
Also, lets advise students to piss money away on rent after pissing money away on school. Would warren buffet do that? Not a very financially empowering path.
x-jla
May 13, 17 4:21 am
*expensive rent
Volunteer
May 13, 17 11:56 am
By the time you buy a house and pay principal, interest, taxes, insurance, maintenance, and upgrades over 30 years it is not necessarily more economical to buy than rent. A lot of people that did buy early in their career are 'underwater' meaning that their house is worth considerably less than they paid for it. The short answer is: it depends, and it depends on factors that are somewhat unknowable at the time of purchase.
x-jla
May 13, 17 10:20 pm
They must not have known the market. I just made 90k on a house that I lived in for 2 years. I Expect even more out of this new one. Rent is a waste of $. I own a few rentals and my tenants are paying off my mortgages. I will own them free and clear in 10 years. Following the standard path is very bad advise to give young people.
x-jla
May 13, 17 10:22 pm
If you must rent (ive been there too) rent cheap. NYC or SF will eat you alive on an architect/designer salary especially if you have student loans.
Wilma Buttfit
May 14, 17 2:55 pm
My house increased in value by $6,000 last month according to Zillow. I'm not banking on it, but it is nice to think of the return I'll get on my original investment. People told me not to buy a house and they told me not to buy a house where I did in - in a gentrifying neighborhood. But isn't that what I know best? Neighborhoods and buildings. Why wouldn't I invest in that?
natematt
May 14, 17 1:53 pm
I can't imagine spending anywhere near that much with those paychecks.
Bench
May 14, 17 5:25 pm
Jla-x, serious question. If the housing market bottomed out tomorrow (a la 2008) do you have a game plan for managing multiple properties that are suddenly worth less than your mortgage? Would you take a government bailout, given your libertarian leanings?
x-jla
May 15, 17 2:03 am
If you open an architecture firm and the market bottoms out like in 2008 do you have a plan to manage the salaries and overhead associated? There is risk in everything. During the last recession rent went up because people still needed to live somewhere. Overall, RE is a good investment if you stick with markets and areas that you know well and have a long term plan. The key imo is to buy homes that need work, do as much as possible on your own to save money, and buy middle class utilitarian homes in established areas where the mortgage is substantially lower than the comparable rents . As for bailouts, I don't believe there are any bailouts available for small fish other than bankruptcy. I totally disagree with the bank bailouts of 08-09. They should have let them sink. Bankruptcy is a necessity however, and it exists to prevent debt slavery. Ive never claimed bankruptcy and hope that I never have to, but yes, if I had no other options I guess I would.
x-jla
May 15, 17 2:07 am
My real goal in all of this is to eventually leverage enough cash to be able to design and build middle class homes that are well designed and crafted. Takes money to do that, and I dont have any rich family:)
x-jla
May 15, 17 2:15 am
Also, to suggest that renters are obsolved
x-jla
May 15, 17 2:23 am
of risk if the market bottoms out is false. If you cannot pay rent because you loose your job (architecture is especially unstable as you know) and get evicted you will find it very difficult to rent again. Its easier to get evicted than to get foreclosed on. And yes, you are still contributing to the problem because your rent that you agreed to pay is essentially covering your landlords mortgage. Like criticizing hunting and then eating a steak...
Volunteer
May 15, 17 7:55 am
Housing is an illiquid investment and the more expensive it is the more difficult it is to sell. Home buyers should be aware of all the costs associated with buying as well as renting. A homebuyer will easily pay three times the purchase price when the principal, interest, taxes, insurance, upkeep, and upgrade costs are factored in. In a low cost area home buying may well be a good deal; in a high-cost urban area undergoing a housing bubble it is not a good deal.
x-jla
May 15, 17 10:57 am
Yes, taxes will kill you in an area like nyc. It could add a couple grand a month. Where i live I pay under 100$ a month. It would be crazy to buy in a tax heavy place like NY. And after all those taxes the motherfuckers cant even manage to fix the potholes.
Wilma Buttfit
May 15, 17 11:53 am
Renters pay for all that stuff (taxes, upkeep, insurance) too, it isn't gifted from the landlord. That's why renting can cost 2x as much as a mortgage for the same property. I agree with renting being more flexible though. Upkeep is something nobody does anyways. Deferred maintenance is the norm. Another short end of the stick that younger people inherit from the older generation. Every property that a young person can afford needs tens of thousands of dollars in repairs.
x-jla
May 15, 17 12:42 pm
All rentals are owned by someone, and if it wasn't profitable to rent out property, rentals wouldn't exist.
Congrats, young intern! You've finished your grueling professional degree in architecture, and now it's time to look for your first full-time job in the business, rent an apartment, and become very close friends with NCARB as you log your hours and study for the registration exams.
In the spirit of my previous thread, here are your housing options in the same 15 cities, based on the following assumptions:
1) You're making the average annual base pay for an Intern 1 according to the 2015 AIA Compensation Report. Statewide figures are used if numbers for a specific city aren't available.
2) Any overtime pay, if you're lucky enough to get paid overtime, is not included in your housing budget.
3) You're single with no kids, and don't want to live with roommates.
4) Your maximum monthly rent is based on 1/36th of your annual gross pay in all cities except New York, where landlords typically require your salary to be at least 40 times your monthly rent. Security deposits and any broker fees are not included.
Sources: 2015 AIA Compensation Report, craigslist.org
Job description from the Compensation Report:
And here's what that gets you:
Cincinnati, OH
Annual Base Pay: $39,800
Max. Rent: $1106
Shown here: 1 bed / 1 bath, Downtown
Commute time: 8 minutes (walk to Fountain Square)
(I actually lived in this building in 2015-2016. Nothing special, but reasonably clean and quiet in a good location.)
https://cincinnati.craigslist.org/apa/6044796216.html
Asheville, NC
Annual Base Pay: $40,100
Max. Rent: $1114
Shown here: 1 bed / 1 bath, Five Points
Commute time: 11 minutes (bus to downtown)
https://asheville.craigslist.org/apa/6023579598.html
Jacksonville, FL
Annual Base Pay: $40,400
Max. Rent: $1122
Shown here: 1 bed / 1 bath, Downtown
Commute time: 5 minutes (walk to Hemming Plaza)
https://jacksonville.craigslist.org/apa/6026583927.html
Chicago, IL
Annual Base Pay: $38,600
Max. Rent: $1072
Shown here: Studio / 1 bath, Lincoln Park
Commute time: 29 minutes (Red Line subway to State / Madison)
(This place is a little special to me, as it was where I got my first apartment as an undergrad, after leaving my parents' house in the suburbs. I paid $485 a month here for a studio in 1996. Sometimes the hot water and elevators even worked. Also, everybody in Chicago apparently has a friend who used to live in this building.)
https://chicago.craigslist.org/chc/apa/6042797160.html
Boston, MA
Annual Base Pay: $43,200
Max. Rent: $1200
Shown here: Studio / 1 bath, Jamaica Plain
Commute time: 25 minutes (Orange Line subway to Downtown Crossing)
https://boston.craigslist.org/gbs/fee/6025139798.html
Philadelphia, PA
Annual Base Pay: $41,300
Max. Rent: $1147
Shown here: 2 bed / 1 bath, East Falls
Commute Time: 27 minutes (Regional Rail to Market East)
https://philadelphia.craigslist.org/apa/5999280564.html
New York, NY
Annual Base Pay: $41,100
Max. Rent: $1028
Shown here: Studio / 1 bath, Bay Ridge, Brooklyn
Commute Time: 43 minutes (R train subway to Lower Manhattan) 1 hour to Midtown
https://newyork.craigslist.org/brk/fee/6020561630.html
Los Angeles, CA
Annual Base Pay: $41,300
Max. Rent: $1147
Shown here: Studio / 1 bath, Culver City
Commute Time: 45 minutes (Expo Line light rail to 7th / Metro Center)
https://losangeles.craigslist.org/wst/apa/6040891022.html
Seattle, WA
Annual Base Pay: $43,100
Max. Rent: $1197
Shown here: Studio / 1 bath, Capitol Hill
Commute Time: 19 minutes (Link light rail to Pioneer Square)
https://seattle.craigslist.org/see/apa/6046833328.html
San Francisco, CA
Annual Base Pay: $48,900
Max. Rent: $1358
Shown here: Studio / 1 bath, Richmond, CA
Commute Time: 1 hour (BART subway to Union Square)
https://sfbay.craigslist.org/eby/apa/6034201281.html
Portland, OR
Annual Base Pay: $39,800
Max. Rent: $1106
Shown here: 1 bed / 1 bath, Goose Hollow
Commute Time: 7 minutes (Blue Line light rail to Pioneer Courthouse Square)
https://portland.craigslist.org/mlt/apa/6047366127.html
Denver, CO
Annual Base Pay: $39,900
Max. Rent: $1108
Shown here: Studio / 1 bath, Capitol Hill
Commute Time: 6 minutes (bus to downtown)
https://denver.craigslist.org/apa/6048400063.html
Minneapolis, MN
Annual Base Pay: $44,000
Max. Rent: $1222
Shown here: 1 bed / 1 bath, Marcy-Holmes
Commute Time: 16 minutes (bus to downtown)
https://minneapolis.craigslist.org/hnp/apa/6040832664.html
Atlanta, GA
Annual Base Pay: $42,900
Max. Rent: $1192
Shown here: 1 bed / 1 bath, Buckhead
Commute Time: 21 minutes (MARTA Gold Line subway to Peachtree Center)
https://atlanta.craigslist.org/wat/apa/6048059492.html
Biggest surprises: the pathetically small amount of money you make in NYC compared to the cost of housing. You can make more money in Minneapolis or Atlanta, and apparently live like a normal human being. Although Seattle has high rents, it's a much better situation if you're renting here vs. buying.
My next and final installment in this series: You've finally become a principal and have married somebody who makes roughly the same amount of money, and you're looking to buy a place. Stay tuned.
Your posts are fun, but these numbers appear waaaay off. What you list as base salary for NYC was like that like 15 years ago. Your other post on Managing Principals also seems very low. Senior Associate perhaps. But even then, general rule on housing is 3x max house cost of annual income. You are way over 5x on most of those. Also, are there more than 10 registered architects in Asheville?
As I mentioned in the OP, the numbers are taken directly from the 2015 AIA Compensation Report. If you think they should be different, take it up with the AIA.
Also, a note about San Francisco's BART system and your transportation budget:
Most transit systems offer an unlimited-ride monthly pass that usually ranges about $70-100. In New York City it's about $115 and includes unlimited rides on the subway and buses throughout the city. Many employers include a transit pass as a perk, or at least let you buy a discounted pass on a pre-tax basis.
You're not so fortunate if you live way out in the Bay Area suburbs and commute into the city on BART each day. BART's fares are distance-based, and no monthly pass is offered. A one-way fare on BART from Richmond to Montgomery Street is $4.65. Multiplied over an average of 22 workdays per month, that's $204.60 in BART fares.
And since you're living way the hell out in Richmond, you probably also need a car for getting groceries, running errands, etc. The average cost of car ownership is $8698 per year, or $725 per month. So that adds up to about $930 in monthly transportation costs if you live in a Bay Area suburb and commute to work on BART in the city.
These two threads are great. They sure make Asheville look like a great place to land after graduation. Cool craftsman style apt when young, and beautiful two story colonial when at mid career. As far as the other cities are concerned, there isn't much of an improvement in life style after 15 years or so in the profession. Pretty demoralizing.
I hated Asheville when I lived there as a kid, but I'd probably appreciate it much more now.
In the part of town where I lived, my best friend's back yard was adjacent to the property of noted landscape architect Doan Ogden, and me and my friends spent many hours exploring the extensive network of immaculately landscaped trails throughout the woods on his property, and we were even invited inside his nice mid-century house a couple times. I'd buy that property and move there in a heartbeat if the opportunity presented itself.
I'm guessing architecture jobs in Asheville aren't exactly plentiful, though, right?
I hated Asheville when I lived there as a kid, but I'd probably appreciate it much more now. In the part of town where I lived, my best friend's back yard was adjacent to the property of noted landscape architect Doan Ogden, and me and my friends spent many hours exploring the extensive network of immaculately landscaped trails throughout the woods on his property, and we were even invited inside his nice mid-century house a couple times.
Some nice pics of Ogden's estate: http://dnrhcc.blogspot.com/2012/04/doan-ogden-field-tour.html
Why wouldn't you want to live with roommates? I've had so much fun with all my roommates ever since college. And of course the plus is I've always lived walking distance to the beach and never paid more than $750/mo
Not everybody wants to live with roommates. I've had some great roommates and some truly terrible roommates over the years, but it shouldn't be the default living arrangement for a professional with an advanced degree if it isn't desired.
I agree but it's not about how advanced your degree is, you could have a doctorate in some angry studies and it wouldn't guarantee financial success. The question is are you providing value with your degree? A good looking functional building is great but honestly I feel as though most architects and drafters can achieve that. Are you providing a good looking functional building on a faster schedule, with less litigation and snags for a more economical price than another architect or a contractor with design services? If yes, then yeah you can charge for it. If not, then you are selling design skills only, thus, your services will remain a luxury expense and not a value expense and you will need to accept the fact that earning a middle class salary for a mostly art based service is pretty good.
I guess a less long winded response is dude, an intern is making 44k/yr painting sketch up models vs. business majors getting sucked into a black hole of excel spreadsheets, or enterprise rent-a-car "management" or cold call sales. Life ain't that bad.
I guess a less long winded response is dude, an intern is making 44k/yr painting sketch up models vs. business majors getting sucked into a black hole of excel spreadsheets, or enterprise rent-a-car "management" or cold call sales. Life ain't that bad.
I'm not sure what you're on about, but in roughly ten out of my 15 examples above, it's perfectly possible to have a reasonable quality of life on an intern's salary without living with roommates. If you want to see the difference having roommates makes in the other five cities, feel free to do your own research and post your own thread.
I could never have roomates. I require privacy and solitude or my brain starts to malfunction.
Great thread! Thanks David.
David - I dated someone that lived in the Chicago building.
David,
my first condo was across the street from 444 St. James. I know quite a few people that lived in that building. I probably ran into you at some point on the street if not at Tin Lizzie! I loved living on that street!
Small world... I never hung out at Tin Lizzie, but when I wasn't flat-broke I was a regular
Small world... I never hung out at Tin Lizzie, but when I wasn't flat-broke I was a regular at a few other neighborhood spots like the Pasta Bowl, Granny's Pancake House up on Diversey, and the Duke of Perth. I have no idea how many of my old haunts are even still in business... Most of my favorite spots in Wicker Park have long since vanished.
I went much smaller with my entry level job. I made less, which by these numbers would put me in the $972 range. I lived in a 1300 sf 2br, 2 bath, apartment that would leave me $222 after rent. There were much cheaper places that could be had as well.
There are definitely benefits to going small. Definitely drawbacks... since there are no firms in my area anymore.
My final follow-up thread: Housing Options for a Managing Principal. As with the other two threads, these show what you hypothetically could buy under certain circumstances, not necessarily what you should buy.
I've been kind of thinking that these are all 'could' and not 'should.' None of these options leave any real money left over at the end of the month. Importantly, you're not accounting for student loans, which eat up a significant portion of income for many graduates (and even licensed architects!)
I assume a certain amount for monthly debt payments in the two scenarios, which could include student loans, car payments, credit card payments, or other debt. The purpose of the exercise was to compare options across a variety of cities, not necessarily to account for everybody's particular situation.
I would strongly encourage people to use the links provided, make their own budget and do their own research, and take into account their own specific needs and financial situation before making any life decisions based on these threads.
Well of course. And it's interesting stuff, although I don't think it stands up to real world scrutiny. When I made this range of salary, my apartment was half of the cost of those shown here, and I didn't exactly have a lot of extra cash left over. It might be a difference in countries though - my loan payments are 5.3% over 10 years, and I'm sure I pay more income and sales tax than most US states.
All one br or studios...if you have kids the costs jump up alot.
Most entry-level architects fresh out of school aren't yet making babies. I'll say it again for the people in the back row:
The purpose of the exercise was to compare options across a variety of cities, not necessarily to account for everybody's particular situation.
Well, if you did a deeper study you would find that the income-living expense gap, between places like NY and Asheville, widens enormously as apt size and br count increases. It would make a stark graph. It would be impossible for a parent (which from what Ive seen makes up about 1/4 of grad students) to live in NYC and afford a 2 bedroom, daycare, student loans, etc. As I've said before, this is why the demographics of the profession closely align with the demographics of privilage. This system is broken.
Also, lets advise students to piss money away on rent after pissing money away on school. Would warren buffet do that? Not a very financially empowering path.
*expensive rent
By the time you buy a house and pay principal, interest, taxes, insurance, maintenance, and upgrades over 30 years it is not necessarily more economical to buy than rent. A lot of people that did buy early in their career are 'underwater' meaning that their house is worth considerably less than they paid for it. The short answer is: it depends, and it depends on factors that are somewhat unknowable at the time of purchase.
They must not have known the market. I just made 90k on a house that I lived in for 2 years. I Expect even more out of this new one. Rent is a waste of $. I own a few rentals and my tenants are paying off my mortgages. I will own them free and clear in 10 years. Following the standard path is very bad advise to give young people.
If you must rent (ive been there too) rent cheap. NYC or SF will eat you alive on an architect/designer salary especially if you have student loans.
My house increased in value by $6,000 last month according to Zillow. I'm not banking on it, but it is nice to think of the return I'll get on my original investment. People told me not to buy a house and they told me not to buy a house where I did in - in a gentrifying neighborhood. But isn't that what I know best? Neighborhoods and buildings. Why wouldn't I invest in that?
I can't imagine spending anywhere near that much with those paychecks.
Jla-x, serious question. If the housing market bottomed out tomorrow (a la 2008) do you have a game plan for managing multiple properties that are suddenly worth less than your mortgage? Would you take a government bailout, given your libertarian leanings?
If you open an architecture firm and the market bottoms out like in 2008 do you have a plan to manage the salaries and overhead associated? There is risk in everything. During the last recession rent went up because people still needed to live somewhere. Overall, RE is a good investment if you stick with markets and areas that you know well and have a long term plan. The key imo is to buy homes that need work, do as much as possible on your own to save money, and buy middle class utilitarian homes in established areas where the mortgage is substantially lower than the comparable rents . As for bailouts, I don't believe there are any bailouts available for small fish other than bankruptcy. I totally disagree with the bank bailouts of 08-09. They should have let them sink. Bankruptcy is a necessity however, and it exists to prevent debt slavery. Ive never claimed bankruptcy and hope that I never have to, but yes, if I had no other options I guess I would.
My real goal in all of this is to eventually leverage enough cash to be able to design and build middle class homes that are well designed and crafted. Takes money to do that, and I dont have any rich family:)
Also, to suggest that renters are obsolved
of risk if the market bottoms out is false. If you cannot pay rent because you loose your job (architecture is especially unstable as you know) and get evicted you will find it very difficult to rent again. Its easier to get evicted than to get foreclosed on. And yes, you are still contributing to the problem because your rent that you agreed to pay is essentially covering your landlords mortgage. Like criticizing hunting and then eating a steak...
Housing is an illiquid investment and the more expensive it is the more difficult it is to sell. Home buyers should be aware of all the costs associated with buying as well as renting. A homebuyer will easily pay three times the purchase price when the principal, interest, taxes, insurance, upkeep, and upgrade costs are factored in. In a low cost area home buying may well be a good deal; in a high-cost urban area undergoing a housing bubble it is not a good deal.
Yes, taxes will kill you in an area like nyc. It could add a couple grand a month. Where i live I pay under 100$ a month. It would be crazy to buy in a tax heavy place like NY. And after all those taxes the motherfuckers cant even manage to fix the potholes.
Renters pay for all that stuff (taxes, upkeep, insurance) too, it isn't gifted from the landlord. That's why renting can cost 2x as much as a mortgage for the same property. I agree with renting being more flexible though. Upkeep is something nobody does anyways. Deferred maintenance is the norm. Another short end of the stick that younger people inherit from the older generation. Every property that a young person can afford needs tens of thousands of dollars in repairs.
All rentals are owned by someone, and if it wasn't profitable to rent out property, rentals wouldn't exist.