Affordable Housing: Providing Housing For Those In Need, Or Making Developers Richer?
New York City government’s attempts to help the under-housed might just be putting fuel on the fire.
There’s no denying NYC needs affordable housing more than Donald Trump needs to lay off the bronzer. The question is: will the city enforce the moral high ground or will they allow developers to make money on the backs of the poor? And, more importantly, who will pay the price?
When it comes to affordable housing, Mayor de Blasio has laid out two options: “do something, or do nothing.” Those who subscribe to this mindset believe that private developers are going to build regardless, and we can either “do nothing” and allow them to build more luxury buildings (comprised entirely of market-rate units), or “do something,” and ensure that these allegedly inevitable new developments are required to include affordable housing.
In the last eight years, the median rent in NYC has increased 12 percent—but income is only up by two percent. How’s that for a rat race? It’s this inequity which contributes to New York’s especially prominent housing reputation. Says Ingrid Ellen, a public policy and urban planning professor at NYU:
“Low-income households are struggling to pay their rent in every city in the United States. And what really makes New York City stand out is that moderate-income renters are struggling.”
For this reason, pretty much everyone can agree that New York City desperately needs more affordable housing. The disagreement lies in how to go about getting it.
When it comes to affordable housing in NYC, it’s a mixed bag, to say the least. It’s no secret that rents here are sky high, and stretch the budgets of even (what passes as) middle-class citizens, let alone for the nearly 50 percent of New Yorkers living near the poverty line (as of 2014).
“New York is the fourth most expensive state to rent a two-bedroom unit,” says the National Low Income Housing Coalition. “…in recent years, a lot of new people have moved into the city and there are more single people living alone. Changes in rent control laws caused the city to lose 250,000 affordable apartments over the past few decades, leading to an even tighter market.”
Given that many real estate transactions—especially rental transactions—leave one with that icky, used car salesman vibe, it’s easy to see why there are those that simply don’t trust the private sector to “do the right thing” when it comes building and preserving affordable housing. Proponents cite examples like Derrick Owens of Savoy Park in Harlem, who came face to face with the dark side of private equity firms buying up affordable housing complexes. In Owens’ case, he was taken to court by Fairstead Capital after the firm bought his building, and then exploited the law to hike the price of his rent-stabilized apartment by $500 a month.
“Where there’s a will, there’s a loophole,” it seems.
Not everyone—de Blasio included—agrees.
This group views the inclusion of for-profit developers as necessary to the solution, and go so far as to saythe exclusion of private sector developers from the building and preserving of affordable housing “would undermine every effort to provide more of the affordable housing New Yorkers desperately need.” The argument here is that it would “limit opportunities to build and preserve affordable housing” (contending that there simply aren’t enough nonprofit developers to handle the workload) and also “lead to more luxury housing” because for-profit entities are going to build either way.
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