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Tenants and housing activists protest at Hunter College where a vote took place to raise rent for roughly 2 million New Yorkers in New York on June 21, 2023.
AFP via Getty Images
The Rent Guidelines Board last week took yet another step toward crushing the city’s housing market by capping rent hikes below landlord costs.
Its members, most tapped by Mayor Eric Adams, gave preliminary approval to rent increases of 1.75% to 4.75% for one-year leases and 4.75% to 7.75% to two-year renewals.
Next month the board will settle on final numbers, but even if it opts for the highest of those ranges, landlords won’t be able to keep up with rising costs — for insurance, energy, taxes, etc. — for rent-stabilized units.
And given the political pressure (especially with a mayoral election looming), it’s a fair bet they’ll cap the hikes below the high end.
Landlords who can’t keep up with costs wind up having to sell to more-unsavory characters, or skimping on maintenance — and tenants suffer either way.
Or owners will simply go bust, losing their buildings to banks — or to the city, for failing to pay taxes, as during the 1970s and ’80.
That’s bad news for people seeking a place to live.
Note: From 2013 to 2023, costs for pre-1974 buildings outside the Manhattan core (i.e., where most rent-stabilized units are located) skyrocketed 37% — yet the board only let rents go up less than 25%.
Meanwhile, Gov. Andrew Cuomo’s 2019 rent law slammed owners with even more financial hardships, preventing them, for instance, from passing along to tenants the costs of bringing vacated apartments up to code.
As a result, more than 10,000 units are sitting vacant instead of being renovated for new occupants. Brilliant.
Plus, the city’s Local Law 97 and Cuomo’s climate law are forcing owners to shell out even more of their stretched dollars to refit buildings in the name of fighting climate change.
Profit margins and building values are taking a dive; thousands of buildings are already in financial “distress,” a trend that’s been soaring since the de Blasio years of insane zero-percent rent hikes.
If board members — or, more important, the elected officials who chose them — truly care about New York tenants, they’d let landlords at least recoup their costs.
If the city keep slapping owners, its housing stock will keep sinking fast, adding to everyone’s misery.
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