NEW YORK CITY—Industry organizations expressed profound disappointment on Tuesday with the Rent Guidelines Board's Monday night vote for a freeze on one-year leases.
Community Housing Improvement Program executive director Patrick Siconolfi says, “The unprecedented rent freeze is in no way based in any sort of economic reality. It will ultimately stifle investment in our city's most important affordable housing stock and will have a detrimental impact on affordable housing for millions of New Yorkers.”
He continues, “Today's decision places unrealistic expectations on building owners to subsidize affordable housing on their backs, despite the city's lack of maintaining control on costs on owners at every turn. Mayor Bill de Blasio and the Board did not take into account these significant costs of maintaining aging buildings and the increasing expenses such as water and sewer rates. The single biggest expense for rent-stabilized building owners is property tax, which accounts for 40% of total building costs and it's growing. If preserving affordable housing was the true goal, the Mayor should start by efforts to reduce property taxes, water costs and general municipal fees and charges.”
Research by the RGB disputes Siconolfi's contentions. According to the New York Times, researchby the board staff showed that landlords' operating income after expenses had grown for nine consecutive years and, in fact, it most recently jumped by 3.4%. Further, operating costs rose by just .5% because of a dramatic drop in fuel costs.
By contrast, according to the Times, the research notes that rent stabilized tenants have been hit with the double whammy of stagnant wages and higher housing costs.
Still, in comments to the Times, Rent Stabilization Association president Joseph Strasburg calls the rent freeze an “unconscionable, politically driven decision to carry out de Blasio's campaign promise of two years ago.”
He continues, “A rent freeze on the surface may sound pro-tenant but the reality is landlords will now have to forgo repairing, maintaining and preserving their apartments, which will trigger the deterioration of quality, affordable housing de Blasio pretends to care about.”
REBNY declined to comment to GlobeSt.com.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
