Home News NYC Landlords Keep Affordable, Rent-Stabilized Apartments Off Market in 2022

NYC Landlords Keep Affordable, Rent-Stabilized Apartments Off Market in 2022

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New York is deep in the neck Housing shortageBut there are thousands Vacant apartment May be available City renter — When the landlord moves them in.

Evan Rugen, founder of real estate investment firm LVL Group NY, says political quirks have allowed landlords to keep affordable units away from the market.In a TikTok video with over 40,000 views, Rügen describes the 2019 action created for protection. Affordable rent The New Yorker did the exact opposite.

It’s all summarized in the elusive New York real estate dream: rent-regulated apartments. The 2019 New York Housing Stability and Tenant Protection Act was created to strengthen rental management, regulate what the price of an apartment will be when the lessor moves out, and allow tenants to stay in the unit longer. it was done.

The law abolished the previous rule that allowed rent-controlled landlords to automatically increase their rent by up to 20% when they became available, limiting the cost of refurbishment that landlords could recover by increasing their rent. .. Today, this means that landlords have less incentive to replace tenants when rent-stable units are available.

Rügen states that instead of keeping rents affordable, the law helped raise New York City’s rents to astronomical levels. This is because the landlord is aware that after investing in an upgrade, a unit with stable rent cannot be listed at market prices. Many landlords are refraining from listing altogether while waiting for New York’s housing law to change.

The Community Housing Improvement Program is an association of nearly 4,000 owners and managers of more than 400,000 stable rental properties across New York City. Estimate From it An apartment with stable rent of over 1 million In New York, 20,000 units remain vacant because the landlord cannot be listed.

It may seem beneficial to the landlord to rent these units at a lower cost than to lose any income, but Lugen says hesitation is based on the life of the tenant. Simply put, if renters have a fair amount of rent, they are unlikely to move elsewhere and the landlord may have to wait years to collect higher rent. ..

“Is one of the biggest questions better than $ 0 for $ 100?” Rugen said. “Well, no, it’s very difficult for tenants with stable rents to leave.”

The law was created to better protect residents, but it can inadvertently make their lives more difficult.New York City New Residential Pool Not keeping up with population growth In other words, rental competition is intensifying.

According to real estate management company Douglas EllimanAbout one-fifth of the May rental contracts in Manhattan were bidding wars. In Brooklyn, it was one of four new signatures. Median rents in these autonomous regions increased by 25% and 18% from the same period in 2021.

Without additional inventory, Big Apple’s housing shortages can be exacerbated — and that means rental prices continue to rise.

“The landlord is taking the New Yorker hostage.”

More New York renters as rents rise and inventory levels fall Price cut Market — and eviction rate climbing..

The Homeless Union, a homeless advocacy group, Due to the increase in the number of homeless New Yorkers For the past decade, there has been a shortage of affordable homes.

During April Real deal reportedThe Community Housing Improvement Program has called on state legislators to allow landlords of units with stable rents to set new initial rents after the renters move out. .. However, the report suggested that lawmakers would be unlikely to accept the deal.

Honda Wang, who worked with the Democratic Socialists of the United States to support the HSTPA advocacy, said the solution would “surrender to the desires of the landlord” to make affordable housing available to all New Yorkers. It says it’s not about building more social housing. It does not exist for commercial purposes.

Honda responded to TikTok’s video on Rügen, saying, “The landlord is willing to release so much just because he thinks he can make more money if the law changes. We have housing inventories. ” “The landlord is taking the New Yorker hostage.”

Rügen believes that landlords need to adjust their behavior to make their homes affordable again, but he believes that changing the HSTPA is a good first step. He proposes to rewrite the law to reduce the previous 20% vacancy bonus to 10% and encourage landlords to refurbish vacant units.

“I think the solution to this problem is to dig deeper into these laws and meet along the way,” Rügen told insiders.

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