Democratic Assembly Passes Pro-Tenant Legislation
In a potentially huge set-back to New York City landlords, the New York State Assembly passed a new package of legislation yesterday that strengthen’s rent regulation across the state and gives more authority to the pro-tenant New York City Council. According to The Times, the new rules would “essentially return to regulation tens of thousands…
In a potentially huge set-back to New York City landlords, the New York State Assembly passed a new package of legislation yesterday that strengthen’s rent regulation across the state and gives more authority to the pro-tenant New York City Council. According to The Times, the new rules would “essentially return to regulation tens of thousands of units that were converted to market rate in recent years” and reduce the amount a landlord is allowed to increase the rent upon a vacancy from 20 percent to 10 percent. It’s a matter of fairness, said Jonathan L. Bing, an assemblyman who represents the Upper East Side. We’re trying to give people a way to live out their lives in the neighborhoods they’ve been calling home for decades. On the other side of the coin: This is going to be very devastating, said Joseph Strasburg, president of the Rent Stabilization Association, a group that represents landlords and real estate agents in the city. New York City is the last big city in the country that has any strong form of rent regulation. And at a time when we have an economic recession, when rents are actually going down, this will put another nail in the coffin. In our opinion, the government should spend more time and resources making sure landlords adequately maintain their buildings and abide by the legal terms of their leases with tenants and less time trying to fight the laws of supply and demand. After all, rents are already coming down anyway.
Assembly Passes Rent-Regulation Revisions [NY Times]
Photo by Bobble
FSRQ;
I agree with you. Sorry, I should have been more specific in my post. I was referring to Bxgrl’s post about the South Bronx in the 70’s, and the redlining going on at that time. In those pre-securitization days, banks were both the originator and holders of the loans. As such, they were leary of lending to rent-controlled buildings in declining areas. From a risk perspetive, their judgment was completely reasonable.
Would that we had such lenders a few years ago, we wouldn’t be in our current mess – which is the point you just made.
We’re on the same page on this one.
sorry dittoburg . . . my bad
Benson you said –
“Banks won’t touch a building when they know that the rent roll is insufficient to cover its upkeep and improvement, AND provide a profit to the owner for taking on the responsibilities of this business.”
If only that WERE true – unfortunately the banks were seduced by greed, stupidity and securitization and put billions into unsupportable loans on huge purchases by the likes of Tishman-Speyer, Stellar Management, SG2, Macklowe, et al. Virtually all these deals and other recent “private equity/hedge fund” (read – idiots who know nothing about RE) deals were done on the basis of “projected rent increases” – which were not at all realistic (bordering on criminal in there divergence from reality).
HOARD apartments or rent them to the HORDES. please.
Bxgrl,
Sure there are bad landlords too. It’s a two way street.
But one OWNS the building and the other RENTS.
I know of a particularly crazy landlady who own maybe 50 million in prime Manhattan real estate. She’s truly insane and hordes vacant classic six apartments rather than rent them out. She scarred to death of dealing with tenants because of all the bad experiences she’s had in NYC housing court and would rather leave her apartments vacant.
But even though she’s crazy, it’s her right to horde vacant apartments. She OWNS the buildings.
Tenant’s have rights too, of course, during the term of their lease. But giving them permanent right to renew their leases at below market rent as the current rent stabilization laws do, is in essence giving them right of OWNERSHIP which rightfully belongs to their landlord, not to them.
You can defend it all you want. Of course the stabilization laws help the lucky few just like lottery winners are lucky. But it’s wrong and deep down I’m sure you know it.
Bxgrl;
You are absolutely right that there are bad tenants (finally got the spelling right) AND bad landlords,just like there are bad butchers, and bad butcher customers.
The difference is that in NYC the law is on the side of a bad tenant. We are supposed to have a government that does not deem a person guilty until proven so. Yet,as I talked about above, the heat control bureau just takes the tenant’s word to be true, and bad tenants uses this government bureauacracy to their advantage. The law in NYC is such that it breeds a sense of entitlement among a certain class of tenants. What should be a normal business transaction, like that between a butcher and his/her customer, is turned into an adversarial relationship often times.
Your point about redlining just reinforces the point that rent control makes a building a poor investment. Banks won’t touch a building when they know that the rent roll is insufficient to cover its upkeep and improvement, AND provide a profit to the owner for taking on the responsibilities of this business.
Bx Girl – Of course RS doesnt cause arson – but you yourself said that “Taxes were to high for what LL’s could rent apartments for” –
well one of the reasons that LLs couldnt rent properties for more was RS/RC (rent control was much more common 40yrs ago). And by the way it wasnt just taxes, Oil – is by far the largest expense and if you recall Oil was through the roof during this period as well.
The What’s right that removing rent regulation completely would lower average rents across the city.
Expanding the rent laws only benefits those luck enough to have below market steals.
Unfortunately those luck few happen to be about 1,000,000 voters who vote in mass to protect their deals. Any who can blame them?
Who doesn’t want a free ride?
Tenants are not the enemy either. Most of us just need a decent affordable place to live. And FYI- I don’t think this bill is a great idea- but please- let’s not spout the old “you’re subsidizing the individual tenant” canard. Homeowners get tax breaks and abatements.
benson- you had a lousy tenant. And I’m sure for every bad tenant story there is a lousy landlord story. Let’s be fair about it.