De Blasio's Plan for Affordable Apartments: Does It Go Far Enough?
A New York Times story on the details of Mayor de Blasio’s plan to create more affordable housing for New Yorkers and bridge the “tale of two cities” divide he campaigned against says his efforts are likely to fail because New York City’s affordability crisis stems from rent deregulation, not a failure to build enough…
A New York Times story on the details of Mayor de Blasio’s plan to create more affordable housing for New Yorkers and bridge the “tale of two cities” divide he campaigned against says his efforts are likely to fail because New York City’s affordability crisis stems from rent deregulation, not a failure to build enough housing.
De Blasio’s goal is to build 200,000 new units of affordable housing, making them mandatory in new developments and tightening the restrictions for affordability so they are more within the reach of low-income New Yorkers. Experts said 200,000 is ambitious: Koch created more than 190,000 units over 13 years, mostly by renovating vacant buildings, and Bloomberg “saved or added” 165,000 units over 12 years, meaning mostly that existing low-income units were preserved with subsidies or incentives.
Bloomberg’s rezoning of more than 40 percent of the city followed by a building boom with voluntary 80-20 developments resulted in relatively few new affordable units: Nearly 3,000. Under the mandatory program de Blasio proposes, perhaps 25,000 to 50,000 affordable units could be added, experts estimate. While that’s far better than the current record, it’s still just a drop in the bucket compared to de Blasio’s stated goal of 200,000 and, more important, the number of affordable units that once existed in the city.
In 1981, rent regulated apartments made up 61 percent of rental units. Now it’s 47 percent. And it continues to drop. Even if de Blasio succeeds in adding 200,000 new affordable units and manages to keep some of the existing 1 million regulated apartments from turning market rate though loans and tax incentives, we’ll still have a crisis, said the Times.
No one is talking about the city building affordable housing (like Mitchell Lama or new low-income projects) because federal subsidies no longer exist.
So really, de Blasio needs to bring back rent regulation, said the Times:
To make truly transformative changes in the supply of affordable housing, Mr. de Blasio would most likely need to find a way to change the state law covering rent increases and apartment regulation. He has told tenant groups that he will go to Albany with them to fight to repeal the statute that gave the state control over rent regulation in the city.
What do you think of de Blasio’s plan for adding 200,000 units of affordable housing?
De Blasio Sets Ambitious Goal for Affordable Apartments [NY Times]
This would be a disaster for market rate tenants:
‘Rent regulated’ housing is either unavailable or not particularly affordable. There are rent regulated people paying less than 1k for a 750 sq ft elevator coop in Brooklyn heights, and there are people paying nearly 20k at the Gehry tower. There’s no guarantee that the latter person is richer than the former.
This kind of thinking would make NYC totally unaffordable to the hipsters and other transplants who have revitalized the arts scene, and would exacerbate the huge income gap between older, rent-regulated tenants and younger free-market tenants. It would also create punitiively high market-rate rents for those who happened to get married, divorced, etc..
The unfortunate thing is that it isn’t as if this is conjecture — NYC already tried this policy and it failed.
What we really need is more housing, relaxed rent controls, an end to over-landmarking, and large-scale rezoning to allow more as-of-right building.
Rent Stabilization of privately owned property does nothing to help low income people for many reasons. But much of what has been de-stabilized, and thus shows on the statistics as a decline in units, are actually rented for less than the regulated rent would have allowed; why, because the market dictates the rent. Most rent stabilized apartments are not in high rent districts and those that are, are more frequently housing the mentally ill, or petty criminals and often no so petty criminals so making them undesirable neighbors, high neighbor turn over and the unit becomes de-stabilized, while the landlord is still housing the mentally ill degenerate rent stabilized tenant, that no one wants to live next door to.
The City should spend more money on NYCHA housing, look how much of that is vacant! And policing the HPD and other City subsidized programs, that after the fanfare of them being built, no one policies. Recently a Broker friend of mine was contacted by a Mortgage Banker to see if she could get 11 apartments rented that had been vacant for more than 6 months so that the refinance that was needed could close, the management company (PACC) after 2 additional months of excuses, phone tag etc. moved tenants from other buildings into the vacancies, so that the loan could close. Or the number of units that have been rehabbed and put into private hands, were supposed to be stabilized, but no one follows up to make sure that that is how the buildings are being managed, or the ones that were supposed to be sold to middle income owner occupants and no one follows up to see that the whole building is rented out at market rent.
Renting a home is not a long term solution to housing. subsidized ownership programs will make better community residents..
“If you made it more difficult for private landlords to remove units,” said Alex Schwartz, a professor of urban policy at the New School, “that’d be a great improvement.” What about cases in which owners of small rent-regulated properties will run (or are already running) a deficit that can only be remedied by legally removing apartments from rent regulation under the current laws? I lived in such a building; my landlord’s family lived there, too. He was a decent guy who did his best for the tenants in his eight-unit walkup, but the building was his only source of income, and expenses far outpaced the rent. He couldn’t even sell it, as it was a lousy investment. When I moved out, he borrowed money from his family to renovate my apartment and get it out of rent stabilization – and I was glad to see him getting a little closer to breaking even on the building. I don’t think the law should force private individuals with small buildings to subsidize their tenants. Developers can build affordable housing into their business plans, but small owners with nonexistent profit margins are a different story.
Many of de Blasio’s policies are dead on, such as raising “taxes on vacant land to close a tax loophole and spur development and… legalizing some illegal basement and cellar apartments.” And the public should “capture” some of the value gained from rezoning.
However, current rent stabilization laws don’t necessarily bridge the “tale of two cities” divide because the income cap is very high. Many people in rent regulated apartments could afford more than they pay.
Well, if the City makes a move to stabilize the rent in the downstairs apartment in my two family house, I’ll take it over myself and quit renting it out. There is no way I would subject myself to rent stabilization regulations; it’s just not worth it.