By Chris McNickle | February 25, 2020

All across New York State the rent is too damn high.

In 54 of New York’s 62 counties 40 percent or more of households are rent burdened. They pay more than 30 percent of their income for a place to live, leaving too little for everything else. It is an affordable housing crisis.

After decades of inaction, the state legislature responded with the Housing Stability and Tenant Protection Act of 2019. Activists laid siege to the state capitol and made our elected officials understand the urgency of protecting families from the consequences of housing costs that had risen faster than incomes for years. Rules that allowed landlords to raise rents on stabilized apartments 20 percent when a vacancy occurred, and to remove apartments from stabilization altogether when rent reached a threshold, were eliminated. Increases to cover capital expenses were scaled back. The law also placed caps on the rent increases trailer park owners could demand.

An important provision of the new law authorizes municipalities all across the state to adopt the stabilization rules. Now, they apply only to New York City and forty downstate jurisdictions. The broader the take-up, the more people will benefit from regulations that strike a necessary balance between a landlord’s profits and a family’s need for a home.

Still, there is more to be done.

New York State should enact a “good cause eviction” law to limit the drastic step of putting families on the street to specific circumstances, like non-payment of rent, destruction of property, or other serious offenses. To prevent landlords from raising rents unconscionably, a sensible limit like 1.5 times inflation, should be part of the rules.

Zoning restrictions should be modified to allow conversions of single family homes into two and three family units in areas that are within walking distance of transit hubs and commercial centers.

Most important, the state must take responsibility for increasing the affordable housing stock in two ways.

Housing affordability is determined by the intersection of housing costs and household income. Yet for policy purposes, it is useful to draw a distinction between New Yorkers who are rent burdened primarily because they have too little money—the income-challenged—and those who have reasonable income but cannot find affordable housing because the market offers too few options at rents in line with typical wages—the priced out.

Families earning below an area’s median income, but above the income a household earns with two full-time workers making the minimum wage set by law, are priced out if they cannot find adequate housing for 30 percent of income. Those making less—a cut-off of $48,000 outside New York City where the minimum wage is $12 per hour, and $60,000 within the five boroughs where the minimum wage is $15—are the income challenged.

The public sector is responsible for protecting people who have too little money, so it falls on government to provide housing for the income challenged. New York State should double its affordable housing budget and launch an initiative to construct 500,000 units over ten years, with rents that are no more than 30 percent of income for eligible families. A household with $20,000 of income would pay no more than $500 per month, a $40,000 household would pay $1,000, for example. The rent collected would, on average, support all operating costs. Non-profit community agencies with successful track records constructing and managing affordable housing should build the apartments to ensure they are compatible with local priorities.

A properly operating real estate market has an obligation to provide housing for workers making standard wages, so private firms should be required to build apartments the priced out can afford. At 30 percent of gross monthly income, affordable housing for families currently priced out would range between $1,500 and $2,500 per month in New York City, with the mid-point at $2,000. Insisting that all new buildings with ten or more apartments include 10 percent of them at each of those three cut-offs—30 percent of all new units in total—would ensure continuous building of new affordable homes for area workers. The upper limit set by area median income would be lower elsewhere in the state.

No special tax incentives would apply. The rents contemplated here are more than adequate to cover non-capital operating expenses plus an operating profit. The cost of capital would ultimately be recaptured when a building is sold.

The policies described would add to tenant protections in the short-term, and over time reduce dramatically the proportion of New Yorkers burdened by housing costs. The sooner they are implemented, the sooner New Yorkers will get the relief they so badly need.

Chris McNickle writes about New York government and politics. His most recent book is Bloomberg: A Billionaire’s Ambition.