ITHACA, N.Y. — If you’ve been in Ithaca long enough, you know the cost of housing just isn’t as low as it used to be. Thanks to a data analysis of housing prices by the Washington Post, not only can we see how much it’s changed, we can also compare Ithaca to its peers. A link to the map is here.
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The Post used Census and financial data looking at the time period of 2004 to 2015, which covers the mid 2000s nationwide housing boom, the deep recession that put many markets underwater, and the latest housing recovery, which could best be described as uneven.
The data covers single-family homes, no condos. Zip codes had to hit a certain minimum threshold for number of houses sold per year, although the Post doesn’t actually state what that number is. Values were not adjusted for inflation. Complete, reliable data was available for about 19,000 zip codes.
Looking at the nationwide picture, there are some areas where prices have boomed over the past ten years, and places were housing values have tanked. Examples of growth can be easily found in Texas, parts of the Pacific Northwest, and some commodity boom-towns like the ones in North Dakota. Prices cratered in places in much of California, Florida, Chicagoland, and suburban counties of the big East Cost cities. On average, housing values have increased about 14% since 2004.
Looking at New York State specifically, the steepest drops in housing value tended to be in the I-84 corridor and parts of Long Island – New York City’s suburban hinterland. Upstate, price changes tended to be modestly up or down – the economy’s been on low gear for so long that there wasn’t really a boom in the 2000s, and there wasn’t much of a bust either. Things have just kept chugging along.
However, there are a couple of exceptions — large price increases in parts of the Southern Tier and the Finger Lakes, and in Jefferson County in the North Country. Jefferson County’s housing values likely grew as a result of Fort Drum’s influence; housing has been tight, especially now that most of their military personnel are serving in domestic capacities rather than in overseas engagements. The Southern Tier might be seeing some value growth from the fracking boom in Pennsylvania’s Northern Tier, and the Finger Lakes perhaps as a retirement and tourism destination, but otherwise there’s no outstanding explanation, apart from values being low to begin with, so there’s more impact per dollar.
Now let’s take a look at the Ithaca area specifically – the average home value in the Ithaca metro has gone up 40% since 2004, far higher than the nationwide average of 14%. Generally, the closer you are to Ithaca’s core, the higher the prices have gone, although the Brooktondale zip code (14817) leads with the steepest increases, 51% in 11 years. The lowest rate of increase was the Dryden zip code (13052), with a 25% increase since 2004. In Ithaca proper, the average value went up 42%, or $78,708.
For the sake of college town peer-comparison, the Burlington, Vermont metro saw 29% price growth from 2004-2015, State College went up about 32%, and Charlottesville went up about 27%.
Let’s put some perspective on this, using non-inflation adjusted wages to go with those non-inflation adjusted home values. In 2004, the median household income in Tompkins County was $38,890. 2015 statistics aren’t available yet, but we know the median household income in 2014 was about $52,885 in Tompkins County, and you can probably tack on a percent or two for wage growth in 2015, so let’s say $54,000 as a 2015 estimate. Wage growth since 2004 is 38.9% – close to the housing value growth. Not too shabby, right?
Well, hang on just a second. As we covered previously, a person can afford a house about 3.4x their annual income under idealized conditions. John Q. Ithacan could afford a $132,226 house in 2004, and a house worth about $183,600 in 2015. The difference between those two numbers is about $51,000.
In other words, John Q’s increase in buying power is being outpaced by the housing price growth in the 14817 (Brooktondale +$62,808), 14886 (Trumansburg, +$63,580), 14850 (Ithaca, +$78,708), and 14882 (Lansing +$55,553) zip codes.
If you wanted to move out to Groton, Newfield, Dryden or Freeville over the last decade, than you were still able to maintain some affordability (the trade off, however, comes in gas and time spent in the car).
But it’s pretty clear that for those living in the 14850 zip code, which happens to be the most heavily populated, affordability is rapidly slipping.
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