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East Village Is No Longer 'Affordable' Option for Most Buyers, Experts Say

By Allegra Hobbs | November 7, 2016 4:40pm | Updated on November 9, 2016 5:02pm

EAST VILLAGE — Though the East Village has long had a reputation as a bohemian artists' enclave, a new look at the neighborhood's cheapest real estate purchases shows it to be on par with historically swankier Manhattan neighborhoods such as Greenwich Village.

The 10 cheapest one-bedrooms available for purchase in the East Village during October ranged from $499,000 to $685,000, according to real-estate analytics team Neighborhood X — not far behind the cheapest one-bedrooms in Greenwich Village, which fell between $585,000 and $795,000.

The high cost of living in the once-bohemian neighborhood signals an important transition from alternative to coveted, according to Neighborhood X co-founder Constantine Valhouli, who said he was surprised to find that the baseline prices across Manhattan neighborhoods had more or less evened out.

East Village Sales

(Credit: NeighborhoodX)

"It's gone from being an affordable alternative to Greenwich Village to an aspirational neighborhood," said Valhouli of the East Village. "It's now a place where one would hope to go, whereas before it was an alternative to a better neighborhood."

In fact, said Valhouli, it seems to be near impossible to buy a livable one-bedroom in Manhattan for much less than $500,000 — which often requires a down-payment of $120,000 to $150,000 — putting it squarely out of reach for lower earners.

In assessing the top 10 most affordable properties in the East Village, the Neighborhood X team focused on one-bedroom units and excluded income-restricted properties such as Housing Development Fund Corporation co-ops, properties requiring all-cash transactions, short sales and foreclosures.

The analysis includes one studio in a co-op building — a 265-square-foot micro unit available for $315,000 — for comparison purposes, to show buyers what they can get on the "kooky" side of the market if they're willing to majorly downsize their lives, said Valhouli.

In addition to solidifying that $500,000 is the city's new real-estate baseline, the near-convergence of baseline prices across its neighboring areas solidifies the gentrification of the East Village — and may even foretell the gentrification of other parts of the city, posited Valhouli. 

"It suggests that, while some of the vitality of neighborhoods fueled by younger people, I think that energy is going to go elsewhere," he said.

"I think the center of gravity is going to shift in New York. The economic pressures are going to force areas farther and farther out to gentrify."

And neighborhoods outside of Manhattan are already catching up, said Valhouli — the most affordable one-bedroom homes in Crown Heights, Brooklyn fall between $480,000 and $649,000, while in Astoria, Queens they fall between $497,000 and $615,000.