Now that the new rent regulations out of Albany are the law of the land, the trouble for New York’s housing stock will simply worsen. The Real Estate Board of New York continues to be deeply concerned that these laws will exacerbate the housing affordability crisis in the future.
By eliminating vacancy bonuses, and all but eliminating Major Capital Improvements and Individual Apartment Improvements, the governor and legislature are consigning hundreds of thousands of tenants to buildings that will fall into disrepair.
A recent analysis by the Wall Street Journal found that the biggest beneficiaries of rent regulation are in fact white, affluent residents of Manhattan, and not the low-income, outer-borough residents this plan promises to help.
Based on the 2017 New York City Housing and Vacancy Survey, the analysis found that more affluent renters received a bigger discount from market rent. A renter with an income in the top quarter of all New York households received a 39 percent discount, paying about $1,650 in rent, compared with $2,700 in rent for a similar renter paying market rents. By comparison, renters in the bottom quarter of income received a 15 percent discount.
To adequately address housing affordability in New York City, lawmakers should craft targeted policies that work to help the low-income and rent-burdened. We believe policy changes to our rent laws should ensure viable financial streams for routine building improvements and continued maintenance; improve data collection and transparency; and increase supply and affordability.
Instead, the laws passed by the legislature and signed by the governor do little to encourage the creation of new affordable apartments that would help ease vacancy rates.
The end result will be that the city’s housing crisis will get worse, with less affordable housing and little relief for those New Yorkers who need the most help paying the rent.
The harmful impact of this legislation will be profound for New York City’s economic future. There are many losers including small property owners, contractors as well as tenants. This legislation will keep rent lower for some, but also significantly diminish housing quality and lead to less tax revenue to pay for vital government services.
There was a path to responsible reform that could have protected tenants as well as owners, jobs and revenue, but Albany chose not to take it.
In other REBNY News:
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REBNY’s 31st Annual Residential Deal of the Year Charity & Awards Gala will be held on Tuesday, October 30 at The Plaza Hotel. Reserve your table and become a sponsor, contact: Yilda Guerrero at yguerro@rebny.com or Olivia Byun at OByun@rebny.com #RESDOY19.
