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Squeezed out: How high rents are driving away LI's millennials

Apartments on Main Street in Patchogue.

Apartments on Main Street in Patchogue. Credit: Newsday/Thomas A. Ferrara

One by one, Natalie Sparaccio has seen her friends and classmates leave Long Island and never look back.

Colorado, Arizona, Florida, South Carolina. Every few months, another going-away party. Millennials all in search of better jobs, apartments they can afford and a nightlife. 

Sparaccio, who is 29, may not be far behind. California maybe.

Right now, she is living with her dad and stepmom in Freeport because she can't afford a place of her own on what she makes as a freelance photographer.

She can't see how she would make ends meet every month between writing a big rent check and paying down the $20,000 she owes on credit cards and student loans.

“It’s just very unreasonable for me to get my own place so I choose to stay at home," said Sparaccio, who graduated from Nassau Community College. "It doesn’t make sense for what you’re paying and what you have to sacrifice."

Other Long Island millennials find themselves in the same bind when they go on the hunt for an apartment or a house: Demand is strong, supply is tight, and the prices are out of their reach.

What they're left with is the choice of crashing with Mom and Dad to save up a down payment or pulling up stakes. 

"It's very disappointing," Sparaccio said. "But you really can’t have everything.”

Economics 101 

Brain drain isn't anything new to the Island.

Adults who fall in the 25-to-34 age category have been leaving for decades. From 1990 to 2016, the number dropped by nearly a quarter — from a peak of 430,400 to 327,250, census figures show.

And the ones who do stay are holding off on getting married and having kids — key factors in buying a home — because they simply can't afford to, bogged down by college debt, stagnant wages and Long Island's high cost of living, experts said. 

The default is living with family.  

In Nassau, for example, nearly half of young Long Islanders are still at home, compared with roughly a fifth nationwide, new county statistics show.

Consequently, homeownership is down, according to the county. Today, three out of 10 millennials own a house. Fifty years ago, only three in 10 didn't own a home.

“We are facing a major challenge to our economic health and competitiveness for the next bunch of years," said county Comptroller Jack Schnirman. "There is a risk that if we only get older and lose these young people, it will cause the tax base to decline. And everyone will lose in that scenario."

The problem is Islandwide.

Nearly half of Nassau and Suffolk residents 25 to 34 live with relatives, show numbers from the Long Island Association, the region's largest business group. And a fifth of married millennials live with family, with many pointing to high housing prices as the reason.

"The economics of housing markets on Long Island appear to be a significant factor in the reduction of independent households formed by millennials," the LIA said in an August 2018 report. "The reduction in households has resulted in an annual $707.2 million loss to Long Island's economy." 

Millennials who do eventually decide to put down roots get a rude awakening when they start looking at how much real estate costs.  

The median price for an existing home on Long Island is just shy of $500,000, nearly double what it is nationwide, the Multiple Listing Service reported.

Real estate broker Bryn Elliott gets why millennials are scared of buying a home. He's not that much older than they are — 39. Student loans, credit card debt, the tight housing market, the economy. 

“Combined, it’s a perfect storm to make it more of a squeeze for Long Island millennials," said Elliott, of Bayville, who is with Douglas Elliman on Suffolk's South Shore.

The law of supply and demand shows prices would come down if the number of houses met or exceeded the number of buyers, but new construction on the Island is slow, Nassau and Suffolk numbers show. 

In Nassau, building permits fell by nearly half in a decade — 47% — from 1,868 in 2008 to 984 in 2018; Suffolk saw a smaller decrease, from 1,396 to 1,002, according to data from the counties. 

Residential construction on Long Island has lagged behind the region since 1980. Northern New Jersey, for example, is building on average nine times more multifamily units than the Island, federal figures show. 

The reason: decades-old local zoning codes coupled with municipal governments too often resistant to change, said Kevin Law, LIA's executive director.

Zoning codes near Long Island Rail Road stations don't specifically allow for multifamily housing development, which requires developers to seek a zoning variance anytime they want to put up an apartment building or condominiums. Sometimes, the zoning process can be overtly political, he explained.

Local governments often express "misplaced opposition" that the projects will bring an influx of families with kids that could strain their coffers and cause property taxes to inch up.

“There is not a problem with developers," Law said. "They want to build. But it’s a tougher sale with municipalities. Elected officials are influenced by school boards which act as 'super zoning' authorities."

The onus is on municipalities to adapt by rezoning downtown areas for multifamily housing and supporting redevelopment — particularly ones tailored for young adults, Law said.

"The millennial population is our current and future baby-making generation," he said. "And our region needs them to grow and repopulate."  

Fight or flight 

Kaitlyn Coyne saw the writing on the wall.

She came back to the Island after graduating from Smith College in western Massachusetts, but didn't like her job prospects and couldn't find an apartment that fit her shoestring budget. 

One-bedrooms on Long Island average about $1,700 a month; a two-bedroom, $2,500, government housing numbers show. 

And buying a home was, well, "next to impossible," she said.

Her options: live with her parents in Farmingdale for another two to three years or move away.

In June, Coyne took a job as a financial analyst for the federal government and moved to a suburb of Washington, D.C., where she lives in a two-bedroom apartment with a roommate. Her share of the rent: $900. 

“I looked everywhere but New York and Long Island," said Coyne, who works at Freddie Mac, the federal home loan mortgage corporation. "I could not justify the cost….”

Coyne misses her friends and her family, of course, but doesn't regret her decision. 

"For me, it was not worth staying," Coyne said. "I would rather be secure and not stressed about finances. And that's what I would have been if I stayed on Long Island."

Dominick Gagnon doesn't buy that someone younger can't afford a home. At 29, the NYPD officer is living proof that a millennial can. He moved into a three-bedroom house in Ronkonkoma last year after living his entire life with his parents in West Babylon. 

Gagnon is blunt about what his peers have to do if they want a piece of property: pass on the new iPhone or the Lexus and cut up the plastic. 

“It’s all about living within your means and not being frivolous," said Gagnon, who has a girlfriend but lives alone. "My biggest message is you need to sit down and make a budget the old-fashioned way. You need to manage your debt, get on a budget and live within your means.”

Still, even good managers need help sometimes. 

Nassau and Suffolk receive federal funds through the Down Payment Assistance Program to help low and moderate-income residents buy homes. Suffolk lends up to $14,000 at zero percent interest; Nassau's maximum loan is $25,000, also at zero percent interest.

Home buyers don't have to repay the loans if they stay for at least five years in Suffolk and 10 years in Nassau.

"We do a lot to educate our kids and want to make sure their talents are here," said Suffolk County Executive Steve Bellone. "That they put their stake in the ground here and raise their families here."

Close to the action 

The first step to keeping millennials on the Island is giving them what they want, regional planning experts said.

And what lots of them put at the top of their list, according to planners, is an affordable apartment near a downtown with a nightlife and a Long Island Rail Road station. 

What the millennials are looking for is what planners call transit-oriented development — and 41 communities already have 114 projects either finished or in the works that fit the bill, according to Eric Alexander of Vision Long Island, a regional planning group that promotes transit-oriented development. 

The projects have created nearly 13,000 housing units and another 10,000 are going through the planning stages, said Alexander, the group's director. 

The apartments can be pricey — a one-bedroom can run more than $3,000 a month in Mineola, Great Neck Plaza and Farmingdale — and only a small percentage are priced affordable, experts said.

Many of the apartment buildings, though, are equipped with amenities such as clubhouse, gym, heated swimming pool, cybercafe or a dog-walking path. 

“There has been tremendous growth and openness to ... and people living near downtowns and using the train stations as an economic engine," Alexander said. “The energy in downtowns are palpable.”

The high rents are keeping away some new college graduates. Right now, baby boomers and Gen Xers are occupying two-thirds of the new downtown apartments, and millennials make up a third of the tenants, Alexander estimated.

To draw the millennials in, communities are using unique incentives.

The village of Westbury, for example, is planning to put roughly 1,000 apartments east of Post Avenue, on 50 acres near its LIRR station. Today, stone yards, vehicle storage buildings and a taxi company are on the land.

Westbury wants to use a $10 million state grant to revitalize its downtown with the housing, said Mayor Peter Cavallaro.

Most buildings on the redeveloped land would be capped at three stories, the mayor said, but the village would allow developers to put up a taller building — five floors — if a number of the apartments units are affordable or set aside for millennials, seniors or veterans.

Westbury also is looking into the micro-apartment, one room often no larger than 400 square feet. The small space usually comes with a foldaway wall beds, folding tables and extra-small or hidden kitchen appliances.

“It’s not going to be the 1950s again," Cavallaro said. "The marketplace is changing. We need to be nimble and be able to change. Otherwise, the community will stagnate.”

Patchogue Mayor Paul Pontieri agrees. His village is fully behind transit-oriented development, building 700 new apartments near its downtown and railroad station.

Also close by is a performing arts studio and a contemporary arts museum. Another draw for the younger crowd: the annual Great South Bay Music Festival.

And the planning strategy seems to be working, numbers show. The average age of Patchogue residents is 35, compared with 42 across Suffolk. 

“We want young families to move into the village and eventually to stay in the community,” Pontieri said. "The message is 'Don’t be afraid. Embrace the change.' You can’t be afraid to adapt."

With Megan Dollar

Correction: An earlier version of this story incorrectly stated the percentage of decline in Nassau building permits from 2008 to 2018. 

Disappearing millennials

On Long Island, the number of 25- to 34-year-olds is dwindling.

1990: 430,400

2016: 327,250, with about two-thirds still living at home.

Source: U.S. Census Bureau

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