Long Island cost of living crisis: How we got here

Their vision, one embraced by hundreds of thousands of Long Islanders over the decades, was of a suburban paradise of single-family homes with white picket fences and private backyards, where residents would host barbecues and family gatherings. It was to be a welcome escape from the urban areas many were fleeing.

But Long Island has become nearly unaffordable for large swaths of the middle class that “Levittowns” were supposed to service, not to mention those living under or close to the poverty line. Thousands of families struggle to get by, figuring out each week how they will pay the rent or mortgage, buy food, cover health care costs, get clothes and put gas in the car. It leaves some having to make a choice between paying the rent or the electric bill.

“People can barely scrape by,” said Martin Melkonian, an economics professor at Hofstra University. “A lot of people on the lower end of income are barely making it.”

The 2023 national poverty level for a family of four is $30,000. The federal poverty rate is roughly 6% on Long Island. But local legislators in a report say that is a vast underestimate for our region and that the real figure should be about $55,500. That means about 20% of Long Islanders are considered "structurally poor."

About 19% of households in Nassau and 26% of households in Suffolk were unable to keep up with the pace of essentials, according to the latest data.

There are other factors contributing to the high cost of living here, including steep property taxes, fueled by high-cost public schools, multiple layers of local governments, and high salaries for public servants, experts said.

Housing costs are at the forefront of affordability on Long Island, experts said.

Early planners erred by overemphasizing the single-family home to the exclusion of multifamily units, including apartments and duplexes, according to experts. That has driven up the cost of housing.

“There was a kind of flawed thinking on the part of people like Moses,” said Neil Lewis, executive director of the Sustainability Institute at Molloy University. “We’ve been living with that consequence here on Long Island for a long time.”

In Nassau and Suffolk, single-family detached homes make up 79.1% of the housing stock, according to U.S. Census Bureau statistics. That compares to 44.4% in Westchester County, 57.1% in Rockland County and 62.9% nationally.

While the Levittown vision initially benefited veterans returning from World War II who were helped by the GI Bill of Rights, today it has some residents doubling or tripling up on jobs, or renting out illegal basements or attic apartments in their homes to be able to afford life here.

The Levitt-Moses model resulted in segregated suburbs, a problem that continues to impact life on Long Island, and those where many people of all races cannot afford to live, experts said.

“I think it was a mistaken belief that suburbs would be just single-family homes and not realizing that you need a mix of housing types right from the beginning,” Lewis said. “It’s just foolhardy to think you could put all your eggs in one basket of essentially single-family homes.”

Rentals account for 17.1% of housing in Suffolk, and 16.1% in Nassau. That compares to 35.5% in Westchester, and a national average of 34.6%, according to census data.

The whole picture creates a situation where "you can have a family that is significantly above the poverty line, but that is shouldering such high housing costs that they have very little left over for health care and for necessities like food," said Christopher Niedt, a professor of suburban studies at Hofstra University.

Most planning experts agree on the solution: creating more of a mix of housing on Long Island that includes multifamily units and apartments, some of it centered around train stations.

That has begun to happen in some areas, including Patchogue and Farmingdale, but it also has faced fierce resistance among many politicians and residents. A proposal this year by Gov. Kathy Hochul to spur 3% annual growth in housing on Long Island, in New York City and in Westchester County — with the state possibly stepping in to overrule local zoning decisions — provoked a heated backlash. She announced a new plan earlier this month that keeps the same growth goal, but would give communities that work to expand housing a priority in securing a piece of $650 million in discretionary funding in the state budget.

Niedt, who is also academic director at Hofstra's National Center for Suburban Studies, said polls find Long Islanders want affordable housing, but oppose “denser” housing. They still want their single-family homes and fenced-in yards.

“It’s just difficult to change a landscape that’s already been built, has been mostly built out,” he said.

Other factors differentiate Long Island from other suburbs nationally, including geography: an island with limited space that's adjacent to the high-cost major metropolis of New York City. That has contributed to this being one of the highest taxed regions in the nation.

There are only 13 counties in the United States where the median annual property tax exceeded $10,000, according to the U.S. Census Bureau American Community Survey in 2021. Nassau and Suffolk were two of them.

More than 60% of those property taxes go to school districts, according to officials.

Salaries for many teachers and education administrators “are just like crazy,” said Steve Jones, former planning director for Suffolk County. The bill for government services is “a minuscule sum of money compared to the cost people have to pay for the educational component.”

Teachers' unions say the pay is well-deserved, and note that teachers, too, have to put up with the high cost of living here.

"Our educators should be paid like the highly trained and skilled professionals they are," the New York State United Teachers, which represents more than 600,000 teachers and other professionals statewide, said in a statement. "It's common knowledge that the cost of living on Long Island is higher than in other parts of the state. As a result, teachers in this region receive salaries commensurate with the cost of living, as do professionals in other fields."

Efforts to consolidate school districts — there are 124 on Long Island — have been discussed for decades, but have proved fruitless, Hofstra's Melkonian said.

Newsday interviewed scores of experts and Long Island families to understand why the region is so expensive. Here are some of the factors.

Housing

Due in part to the COVID-19 pandemic, home prices on Long Island hit record highs last year. They have fallen only slightly this year, even though interest rates have doubled. Demand is badly outstripping supply, jacking up prices in an already expensive real estate market.

The median home price on Long Island, excluding the East End, jumped 66% between 2012 and 2022, according to a report from New York City-based real estate brokerage Douglas Elliman and appraisal firm Miller Samuel.

The median home price on Long Island, excluding the East End, was $600,000 last year.

At the end of May, fewer than 5,000 houses were on the market across Nassau and Suffolk. Over the past 35 years, there have been nearly four times as many available properties on average at that time of the year, according to OneKey MLS data.

Renting

Renting is prohibitively expensive for many, partly because population growth is outpacing the growth of rental units. More than half of renters in the region spend more than 30% of their income on rent, according to 2021 census data.

Nassau’s population grew by about 62,560 between 2010 and 2021, but the number of rented homes increased by only about 3,740, according to the data. In Suffolk, the situation is even more dire: Its population grew by about 40,450 residents, but the number of rental homes decreased by about 395, census data shows.

Amid those pressures, median monthly rents soared: In Nassau, the median went from $1,407 to $1,940. In Suffolk, it jumped from $1,427 to $1,895.

Taxes

The Island is notorious for its high property taxes, among the highest in the nation. And more than 60% of those taxes go to local school districts. The region’s 124 districts, each with its own administration, and high teacher salaries contribute to the tax burden. The average pay for full-time educators, including teachers and administrators, on Long Island is $111,262, according to the Albany-based Empire Center for Public Policy. That is the highest figure of any region in New York State.

Keeping Long Island safe is another costly endeavor that adds to high taxes. Starting pay for new officers in Nassau, for instance, is $37,333, and top base pay is $141,000 for officers (not including detectives and supervisors). That is not counting overtime pay and other benefits that often add on thousands more.

Child care

Child care can cost more than sending a child to state college. The average price of full-time child care ranges from $12,000 a year for a preschooler to $20,000 a year for an infant, said Jennifer Rojas, executive director of the nonprofit Child Care Council of Suffolk.

In Nassau, the average cost for full-time child care is $15,000 a year for an infant and more than $13,000 for a toddler or preschooler. By comparison, yearly tuition and fees at Stony Brook University and Farmingdale State University are $11,422. At SUNY Old Westbury, the total is $8,379.

Transportation

Getting around Long Island can be difficult, and pricey. The cost of owning a new car spiked 11% in 2022, to $10,728 a year, according to AAA. Used car prices have peaked, too, which along with insurance, fuel and maintenance costs make owning one untenable for many residents.

Public transportation isn’t much better on the pocketbook. Taking the LIRR often costs commuters hundreds of dollars a month. The MTA has approved fare and toll hikes to take place on or around Aug. 20, including a fare increase of an average 4.3% for weekly and monthly LIRR tickets. Subway fares will go from $2.75 to $2.90. That same change will take place on Nassau's NICE buses because the system accepts the MetroCard. The MTA also will increase toll revenue by 6%.

Food

Food prices are at all-time highs, and expected to keep going higher. Food pantries report more people seeking emergency food aid — a sign of Long Islanders’ desperation.

Qualifying for food stamps can be difficult for many families who need them. The true definition of poverty on Long Island, based on the costs of housing, food, transportation and basic necessities is about $55,500 a year for a family of four, the Suffolk County Legislature’s Welfare to Work Commission reported last year.

But the official federal poverty level, which determines eligibility for government benefits, including food stamps, is $30,000 for a family of four. The official poverty level does not consider regional cost differences, which hurts a high-cost region like Long Island, according to local officials.

Utilities

Customer bills have hit record highs the last two years. Soaring numbers of gas and electric customers have been late in paying their bills during that time.

And the situation may get worse. National Grid is seeking a 16% increase in customer gas bills next year. Liberty Utilities, which took over a large section of Nassau’s water customers, announced it is hiking rates an average 34% next year. The Suffolk County Water Authority raised rates 4.8% in May.

Bank fees

Many Long Islanders face an often-invisible economic headwind from bank fees, burdensome loan terms and high interest rates. These often drive low-income people away from institutions used routinely to manage finances.