I found it astonising that in this article it was mentioned nowhere that perhaps the burgeoning popularity of studios had to do with the fact that they may be the only "affordable" real estate left in NYC! It kept trying to figure out why studios were so popular. Um, duh?!

So many people I know can barely even afford their studios in NY. The housing situation here is RIDICULOUS!
All the real NYers are getting pushed out while the richies are buying all those d@mned "luxury condos". Everytime I see a new "luxury condo" going up in my neighborhood it makes my stomach turn thinking of how much longer until I get pushed out.
And who the he!! are all these richies anyways?
How can they afford it????

Hi, Sweat Pea.

To answer your question: I think that they are all probably hedge fund managers, brokers and "developers".

At least that's the demographic for most of the "McMansion" owners out here in the Hamptons.

Studios are more expensive than any other units p/sf due to the fixed costs of plumbing, electrical etc. being spread out over a smaller area. Comparatively, a 2 bed 1 bath requires the same fixed costs but has more square feet to spread out costs.

Don't let the argument of more p/sf be a basis for a purchasing decision alone. Otherwise we would all be living in the burbs spending our lives in cars and strip malls and reading a mcmansiontherapy.com blog.

Sorry that I mis-spelled your name. Art

no, no, please try not to get jaded! there are still affordable studios for folks earning low to middle class incomes out there in H.D.F.C. co-ops in the city. that's how i purchased my studio in the lower east side. at the time i was a single person making less than 40k/year - and that's the only reason why I qualified. look up H.D.F.C. info online to see what i'm talking about. i feel bad for folks who are in the high middle income bracket who make 'too much' money to qualify for a place. but i know that some building managers are trying to get the income requirements expanded to include higher income folks. i am not expert on this - you'd have to do your own sleuthing. but please have faith that the housing market isn't a total lockout!

who are all the richies? Without meaning to sound at all xenophobic, I think its lots of foreigners. Our currency is in the toilet, my friends, and many of my german pals are parking their all-mighty euros in new york/ long island real estate.

And studios are especially atttractive for the pied-a-terre types.

Because trust me, hedge fund cowboys and bankers are NOT living in studios.

wiscompton - excellent point about "spreading" the costs of plumbing, etc.

"many of my german pals are parking their all-mighty euros in new york/ long island real estate."

Hmmm...Germans buying on Long Island. THAT should go over big!

I went apt hunting with a hedge fund friend, maybe year and 1/2 ago. Was appauled at what 1.5 bought - a crappy apt at 4th Ave & 10th St. Crappy. Sadly, it sold quickly. So I asked him who could afford all these apts - he replied foreign money. I also just recently read an article about Irish people who were buying apts in NYC. It was a badge of honor for them to be able to afford an apt in NYC, something their recently growing economy could now afford with our weak one.

Hearing about all of these foreigners buying in our fair city makes me happy that the dollar is tanking and weakening every day. Imagine what a "badge of honor" it is to see the studio they paid 500,000 euros for devalue into 400,000 euros, even though the market value in terms of dollars remains constant or even appreciates.

Once word spreads that real estate values will start to decline in earnest, in tandem with the value of the U.S. dollar, we will finally see a major retreat by the foreigners. Patience wins the game.

betsbillabong, does this count?

"Since studios are generally still the most affordable apartments around, they remain the entry-level purchase for first-time buyers trying to get a toehold in the New York market".

why all the xenophobia? does it really matter if irish or germans or anyone else is buying real estate in new york? point the finger at our own government who continues to spend $14 billion/month on a war we never should have been in and will never get out of, causing our national debt to skyrocket (and be bought up by the chinese government), thus making our dollar worth squat and encouraging foreign investors to by manhatan property.

if you want to fault anyone, point the finger at the current administration in the white house whose terrible economic policies are squeezing the middle class into virtually nothing, and the state of new york, which under the pataki administration syphoned federal appropriations for affordable housing to his own pet projects outside of new york city.

kelton--

what xenophobia? who's pointing? man, I'm JEALOUS. I wish I had bought in Berlin 10 years ago! The way I see it, these complaints about the NYC housing market are just a roundabout way of protesting GWB's policies that are achieving some all time lows for the dollar. The reason the looney is now stronger than a greenback has a lot to do with the war. duh. In the meantime, the fact is that foreign currency is buying up the nyc residential market-- especially all those places the hip kids wanna be. Been to williamsburg lately?

HDFC co-ops are one of those great secrets of New York. Quit complaining and start hustling! Also, make your own hipness. There are many neighborhoods that are reasonably affordable so long as you don't care to buy into other peoples concept of cool.

I'm not surprised that studios cost slightly higher than one-bedrooms in terms of $ per sq ft. Most bedrooms in Manhattan cannot fit a queen-sized bed and dresser. The flexibility of having the open space of a studio is more useful than an arbitrary 'wall' that divides the space into a bedroom and living area.

My favorite apartment was a 650 square foot studio in Berkeley. It was a beautiful pre-war unit situated on a corner with 11 windows, separate kitchen that four people could simultaneously cook and mingle in comfortably, views of the Berkeley Hills, the UC campus and a series of green houses across the street. The living space was bigger than my brother's entire apartment in the East Village. It was definitely larger than most of my friends' one bedrooms in the SF Bay area.

I live in a comparably sized one bedroom now in the Upper East Side and I'd give it up in a heartbeat for the same layout and number of windows as my old place. My friends still mention that apartment fondly to me every once in a while and all the good times we enjoyed there.

I always hear that trust fund babies are a big factor too, especially in places like Williamsburg.

My native Williamsburg ("East W'brg" now, apparently) friends watched the area go from dicey to pricey, with many of them now unable to find a place in the neighborhood where their parents still lived. A lot of newcomers would be surprised to hear that the L used to be one of the most dangerous subway lines, or hear stories of the '77 blackout. As one friend told me, "Yeah, a lot of my neighbors got new tv's that night!" Must be weird for them to see so many people move in who have no idea about the history. Actually, it wasn't until I moved away that I found out that I (and many of my friends) were mispronouncing the name of our street!