Albany last month finally found a way to continue rent regulations in the city. But the new regulations barely address the bigger issues facing housing in the city — long-term affordability for most tenants and homeowners.
The city’s long-term sustainability plan, PlaNYC2030, does acknowledge that challenge. And in its update released earlier this year, the Bloomberg administration takes these efforts a bit further, acknowledging the importance of saving housing and the neighborhoods where people live. However, that too falls short because the mayor still puts the priority on zoning to promote new housing and gives short shrift to preserving our neighborhoods.
After the Bubble
On the bright side, New York City is doing better overall than many other cities, according to a recent report by NYU’s Furman Center, though comparisons can prove difficult because New York’s housing, with so many large rental buildings, differs from that of most other cities. Recent announcements of some major new luxury apartment and office deals seem to suggest New York is a long way from any catastrophic collapse.
Despite these hopeful signs, a raft of problems still afflicts housing in New York. Three years after the housing bubble burst, hundreds of construction sites around the city remain stalled. Developers face a shortage of cash, and banks are reluctant to finance purchases. Also, cuts to federal rent subsidies are hurting both tenants and building owners. Public housing is broke, and the city housing authority is looking for private partners to bail it out. Other staples of affordable housing in New York, such as the Mitchell-Lama program, have dwindled after decades of private sellouts.
In a flat economy with high unemployment, tenants and some homeowners in the city face big tax bites. Many homeowners grapple with mortgage debt, while housing values remain stagnant. There are some 40,000 homeless people living in shelters, over 9,000 households currently affected by foreclosures, about 700 buildings vacated by city order and a record-high stock of what experts euphemistically call “distressed housing” — homes that are poorly maintained, over-mortgaged and in deep trouble.. And the Rent Stabilization Association reports that last year over 13,000 apartments were decontrolled and thus less likely to remain affordable.
According to the Real Deal, “Home prices declined between the last quarter of 2010 and the first of 2011 in every borough except Queens where housing prices were flat but remain about one-third lower than peak values in the fourth quarter of 2006 and mid-2007.” And the Wall Street Journal reportedthat many condos and homes in the city have borrowed more than the current value of the property.
As both housing advocates and real estate investors are quick to point out, housing is not just about a roof over your head, it is about having a home in a decent living environment, or “location, location, location” to use the real estate industry phrase. And affordable neighborhoods are in trouble.
During the real estate bubble, many tenants and homeowners in affordable apartments and homes that were subsidized with public money either took cash incentives to move or were pushed out of their homes. This fractured their connections to friends and neighborhood, a prime element in the city’s lively communities. A mix of long-time residents was replaced by a homogeny of young singles seeking the “authentic” neighborhoods that are no more. The remaining affordable neighborhoods are looking at the possibility of more overcrowding, less money for building maintenance and more vacant buildings.
Read the full post at Gotham Gazette.