Tag Archives: housing policy

The Real Deal: NYC’s Rent Stabilization Crisis

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Jonathan Mines of the Mines Group; David Reiss, former RGB chair; Rafael Cestero of Community Preservation Corporation (Getty, LinkedIn, Mines Group)/Graphic by The Real Deal

The Real Deal quoted me in NY’s Rent Stabilization Crisis. It reads, in part,

The goal for rent-stabilized housing, as panelists from the landlord and tenant sides agreed at a sold-out New York City Bar Association event last week, should be a return to balance and predictability.

In that perfect world, owners get enough revenue to sustain their buildings and earn modest returns, tenants pay their rent, and those who cannot afford it are subsidized by the government, not by the landlord.

Reality check: This scenario is not readily achievable. It might even be impossible.

The consensus among the expert panelists was that the politics that governs rent regulation in New York will continue to result in overcorrections as legislative power swings from one side to the other.

“There is no way that a political process is going to create a good outcome for tenants and buildings over the long run,” said Rafael Cestero, CEO of the Community Preservation Corporation.

Cestero said 36 percent of the huge portfolio of rent-stabilized loans that CPC services have a debt service coverage ratio below 1.0, which means the buildings securing those mortgages lose money every month.

When owners had the upper hand in Albany, “they kept asking for more and more,” he said. “The dynamic has now completely flipped. Tenants have the power in Albany, and continuing to ask for more and more and more is just going to perpetuate the cycle of where we are today.”

And where is that?

“I do think,” said former Rent Guidelines Board chair David Reiss, “we’re in the midst of a slow-moving train wreck.”

Current Issues in Affordable Housing in New York City

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New York City Bar

I will be moderating a panel on Rent Freezes, the Housing Stability and Tenant Protection Act of 2019 (HSTPA), and Nonpayment at this in-person New York City Bar program on May 7th. The registration link is here and the full program description is below:

Description:

This program will provide an inside perspective on the future of affordable housing in New York City.  Seasoned practitioners from the private and public sectors will discuss the role of the city, state and federal governments, in conjunction with for-profit developers and not-for-profit organizations, in building and preserving affordable housing. Participants will learn about the statutory, regulatory and business considerations underlying critical topics in affordable housing.

Three expert panels will present on the following:

    • Rent Freezes, the Housing Stability and Tenant Protection Act of 2019 (HSTPA), and Nonpayment
    • The Community Opportunity to Purchase Act (COPA)
    • Case Study – Office to Residential Conversions

The detailed agenda for the day follows.

9:00 am – 9:05 am        Introduction & Program Overview

Farhana H. Choudhury, Associate Counsel/Chief of Staff for Legal at NYSHCR

Julia A. Solo, Senior Vice President & Counsel at Federated National Land

9:05 am – 10:05 am       Panel 1: Rent Freezes, the Housing Stability and Tenant Protection Act of 2019 (HSTPA), and Nonpayment

This panel will focus on the impacts of the HSTPA that have limited rent increases for things like apartment and major capital improvements, the Mamdani administration’s proposal for an extended rent freeze, and post-pandemic rent collection challenges.

Organizers:

Farhana Hassan Choudhury, Associate Counsel/Chief of Staff for Legal

Andrew M. Darcy, Pro Bono Counsel at Cleary Gottlieb Steen & Hamilton LLP

Moderator:

David Reiss, Professor, Cornell Law School

Panelists: 

Doug Apple, CEO, 1811 Consulting

Rafael Cestero, CEO, Community Preservation Corporation (CPC)

Tim Collins, Partner, Collins Dobkin & Miller LLP

Rob Ehrlich, Partner, Lazarus Karp Ehrlich McCourt, LLP

Topics will Include

    • Trends in Court
    • Long-Term Sustainability & Expectations Over the Next 5-10 Years
    • Potential Solutions
    • Public Commission

Question & Answer Session Conclusions

10:05 am – 10:15 am    Break

10:15 am – 11:15 am     Panel 2: The Community Opportunity to Purchase Act (COPA)

This panel will discuss the current status of the Community Opportunity to Purchase Act (COPA).  In December 2025, COPA passed the City Council but was vetoed by outgoing Mayor Adams on his last day in office. Mayor Mamdani and new City Council Speaker Menin did not attempt a veto override when the new City Council was seated in January, and the bill which passed City Council in December is effectively dead for the time being, although many advocates and politicians, including Mayor Mamdani, have vowed to continue the fight for COPA. It’s not clear where COPA will stand in May, but this panel will examine the history and advocacy behind COPA, its operation in Washington, DC and San Francisco, and potential constitutional challenges to the law.

Organizers:

Gerrald Ellis, Deputy General Counsel, Paths Development

Alexandra Hohauser, Associate at Nixon Peabody LLP

Moderator:

Gerrald Ellis, Deputy General Counsel, Paths Development

Panelists:

Erica F. Buckley, Partner, Nixon Peabody LLP

Arielle Hersh, Director of Policy and New Projects, UHAB

Topics will Include

    • Overview of COPA, as proposed, in NYC
    • Current status of COPA in NYC
    • Discussion of the main sticking points in even getting COPA passed
    • Discussion of COPA in Washington, DC and San Francisco
    • Potential constitutional challenges

Question & Answer Session  Conclusions

11:15 am – 11:25 am     Break

11:25 am – 12:25 pm     Panel 3: Office to Residential Conversions that include Affordable Housing

This panel will discuss the challenges and benefits to office-to-residential conversions in New York City, including land use considerations, challenges in design, the unique considerations of financing, the 467-m tax incentive and case studies.

Organizers:

Daniel M. Bernstein, Member and Leader of the Tax Incentives and Affordable Housing Department at Rosenberg and Estis, P.C.

Zachary L. Nathanson, Senior Associate Attorney at Adler & Stachenfeld LLP

Moderator:

Daniel M. Bernstein, Member and Leader of the Tax Incentives and Affordable Housing Department at Rosenberg and Estis, P.C.

Panelists: 

John Cetra, FAIA, Co-Founder, CetraRuddy Architecture D.P.C.

Tricia Dietz, Assistant Commissioner for Housing Incentives, NYC Department of Housing Preservation and Development

Alexander Tendler, Vice President at Vanbarton Group

Daniel Weisen, Senior Director at Eldridge Capital Management

Topics will Include

    • Land Use Considerations
    • Partial Conversions
    • Design Considerations in the Conversion Process
    • 467-m: Eligibility Considerations
    • 467-m: Applying for Tax Exemption Benefits
    • Lender Considerations
    • Case Studies

Question & Answer Session Conclusions

12:25 pm – 12:30 pm     Closing Remarks

Farhana H. Choudhury, Associate Counsel/Chief of Staff for Legal at NYSHCR

Julia A. Solo, Senior Vice President & Counsel at Federated National Land

Is It a Homebuyer’s Market?

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CC BY 2.0 Mark Moz

Marketplace quoted me in Is It Really a Homebuyer’s Market Now? It reads, in part,

Housing prices are dropping and buyers are scoring steep discounts on their purchases, indicating that the real estate market is becoming more favorable for buyers. But while some homebuyers are getting better deals, housing is still out of reach for many Americans and the 30-year mortgage rate remains above 6% — double what it was in 2021.

The typical homebuyer got a discount of 3.8% or $15,196 in 2025, with 62% of all homebuyers paying less than the list price, according to a new Redfin study.

“Some sellers haven’t adjusted to the fact that demand is much slower than it was during the pandemic homebuying frenzy. They watched their neighbor’s home sell for tens of thousands of dollars over the asking price back then, and are now pricing their homes based on that,” stated the authors of the study.

And for the first time in two years, national home prices have gone negative, declining 1.4% in the last quarter of 2025, according to Parcl Labs, a housing data and analytics firm.

“I think big picture, any decline or slowing of growth is better for buyers than the type of growth that we have been seeing for a few years,” said Nicholas Kacher, an associate professor of economics at Scripps College in California.

But although there are positive signals out there for homebuyers, there are also some “countervailing points” that indicate the market isn’t entirely in their favor, said David Reiss, a law professor at Cornell University who studies housing policy.

Signs that buyers may still struggle on the market

Home sales are at a 30-year-low, which means sellers are either keeping houses off the market or buyers are not willing to purchase them, Reiss said.

“The market is not super liquid right now,” Reiss said.

Plus, nearly a quarter of homes still sold above list price last year, Reiss pointed out.

     *      *      *

The solution: Increase supply

The major issue with the housing market is that the U.S. is simply not building enough housing, Reiss said.

“It’s tough to build housing, and a lot of markets, lots of localities, discourage it. They don’t want new housing. They don’t want the construction. They don’t want to pay for the social services that are attached to it, like new schools and new medical facilities,” Reiss said.

 

What’s Andrew Cuomo’s Plan to Help New York City Renters?

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The New York Times interviewed me in a video, What’s Andrew Cuomo’s Plan to Help New York City Renters? The transcript reads,

“Can you describe rent prices in New York?” “High.” “Expensive.” ”Out of control.” ”The rent here is absolutely crazy.” “Very, very unaffordable. Two verys — yeah very, very expensive.” Median asking rent in New York City is up more than 7 percent in just the last year. It’s now about $4,000 per month. That’s made the cost of housing a key issue in the mayor’s race, with the top candidates each proposing changes to a core New York City housing policy: rent stabilization. Nearly half of the apartments in New York are currently rent stabilized, which means that their rent increases are determined by a government agency controlled by the mayor. That makes rent stabilization a hot button issue for hundreds of thousands of voters. After front-runner Zohran Mamdani revealed what he pays in rent — “$2,300 for my one bedroom in Astoria.” — rival Andrew Cuomo argued he was unfairly occupying an affordable apartment and shouldn’t qualify for rent stabilization because he makes $142,000 a year. “Rent-stabilized units, when they’re vacant, should only be rented to people who need affordable housing.”

Many rent-stabilized tenants are low income, but about 16 percent of rent-stabilized households do earn at least $150,000 a year. If elected mayor, Cuomo says you could only qualify for a rent-stabilized apartment if your rent is 30 percent or more of your income. Let’s say this couple is looking for an apartment. Their salaries are $35,000 and $45,000 a year. They find a rent-stabilized apartment for $2,000 a month. That’s 30 percent of their income. So under Cuomo’s plan, this couple will face less competition for this lease because anyone who makes more than them could not apply for the the apartment. Means-testing is popular with voters. About 65 percent supported it in a recent Times-Siena poll.

But critics argue that Cuomo’s plan reflects a misconception that rent stabilization is an affordable housing program. In fact, it’s a form of market regulation with roots in the postwar era. “After World War II, you had returning G.I.s starting families.” The rent gets too damn high and the government takes a look to say, ‘Is there something we could do about it?’” Some apartments in this period were rent-controlled. The system that eventually effectively froze 1970s rents in place like the famously low-rent apartments from “Friends” and “Sex in the City.” “You have a rent-controlled apartment? I suggest you stay there.” In reality, only about 1 percent of apartments are rent controlled today. Most are now covered by rent stabilization, which first became law in 1969. “It really was this broad-based sense that tenants needed the government to come in and kind of limit that increase in their rent. Rent stabilization was not designed to take into account the income of the tenant at all. Rent regulation was really put into place to say when the vacancy rate is so low, landlords can’t use that as an opportunity to gouge tenants for increases in rents.” Today, rent stabilization applies to most apartments in buildings with at least six units that were built before 1974. That covers about one million units and two million New Yorkers. Rent increases are set by the mayor-appointed Rent Guidelines Board. “So you’re not at the mercy of your landlord solely. They can only go according to the increased percentage rate that the Rent Guidelines Board decides.”

Joanne Grell is a tenant advocate in the Bronx. She moved into a rent-stabilized apartment nearly 25 years ago and still lives in it today. “I moved here back in 2002 with a 2-year-old and a 5-year-old, not knowing exactly how I was going to be able to be a single mom and afford to live in the city. Fast forward 23 years later, I raised my children here.” When she moved in, her rent was about $950 a month. She earned a moderate income, but if means-testing had been in place, she wouldn’t have qualified for her unit. “When I moved in here 23 years ago, it might have been 20 percent of my salary. So if Cuomo’s means-testing proposal was in place when I applied for this apartment, I would have never been able to get it.” Now, she does spend more than 30 percent of her income on rent, which has gone up to $1,750 a month. Grell plans to vote for Mamdani this election because she believes his proposal to freeze the rent would help struggling tenants like her and 69 percent of voters in the Times-Siena poll agreed. “My upstairs neighbor said to me, ‘If I get another increase, I will not be able to keep my apartment.’ That’s how serious it is.”

David Reiss said that Mamdani’s rent freeze would help tenants in the short term, while Cuomo’s means-testing would be an administrative nightmare that could make life difficult for many. Ultimately though, he said neither of these policies address the root cause of high prices: that there aren’t enough apartments to go around. Both mayoral candidates have said they support building hundreds of thousands of units to help address the housing shortage. “We need more housing, a lot more.” “Get the supply up. The rents will come down.” But Reiss says neither candidate’s plans would meet the demand and don’t account for factors like population growth or apartments being demolished. “Politicians from President Trump to Andrew Cuomo to Zohran Mamdani, have all proposed policies to address housing affordability. But it can’t just be doing what we’re doing now, but a little bit better. Fundamentally, if you want to increase affordability, you have to build more housing.”

The FHFA’s @Pulte Acts on X Alone

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Business Insider quoted me in Mortgage Regulator Bill Pulte Has Posted at Least 13 Agency Orders on His Personal X Account (behind a paywall). The story reads, in part,

Until he became the head of the Federal Housing Finance Agency and a warrior in President Trump’s fight with the Federal Reserve, Bill Pulte was mostly known for posting on X. Under the handle @pulte, the businessman frequently sent groceries and gas money to people in need.

In his governmental role, which he assumed in March, Pulte has continued to use X as a megaphone. Over the last six months, he has posted at least 13 official orders on his personal account — and they don’t appear to be posted publicly anywhere else.

The practice is unusual for the head of an agency that regulates Fannie Mae and Freddie Mac, the two housing-finance companies under federal conservatorship central to the $21 trillion residential mortgage market.

*    *     *

“This is very abnormal,” said David Reiss, a law professor at Cornell University who focuses on housing policy and real-estate finance. “I don’t know what a court would do if someone sued based on an order that he only posted on X.” He added by email that impacted parties might argue that carrying out official acts by an X post doesn’t comply with the Administrative Procedure Act.

The FHFA did not respond to questions about Pulte’s posts. Pulte didn’t respond to a request for comment.

Best & Worst Places to Rent in America

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I was interviewed as part of WalletHub’s Best & Worst Places to Rent in America, 2024 edition. The interview reads,

What tips do you have for a person looking to get the best value in an apartment?

The smartest thing to do is do your homework. Start online to get a sense of the broad range of options. Then visit as many as you have the time for. Not only does it give you a sense of the surroundings (neighbors, neighborhood, shopping, etc.), but it also gives you a sense of the quality of the apartment. Do the appliances look well-maintained? Is there any water damage that may be a harbinger of bad things to come?

What are the most common mistakes that renters make when searching for a new apartment?

It is also smart to ask existing tenants about the landlord. Is it (or he or she) responsive to concerns? You should also search them on the internet to see what others have to say about them.

How can local policymakers make housing more affordable for renters without upsetting homeowners?

Local policymakers need to focus on expanding the supply of new housing. Restrictive zoning (for example, zoning that only allows the construction of single-family homes) keeps housing expensive in many communities. Various forms of restrictive zoning are a big problem in hot markets like the Bay Area in California and the New York Metropolitan Area. Housing takes too long to build, we do not build enough of it, and it costs too much. Local, State, and Federal policymakers all have to work together to increase the supply of housing so that costs go down across the board.

Housing Problems and Federal Assistance

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Family living in a one-room tenement. New York, NY, USA (1890) by Jacob Riis. This version was colorized by Kelly Short.

The Urban Institute’s G. Thomas Kingsley has posted a brief, Trends in Housing Problems and Federal Housing Assistance. It opens,

In the 1930s, many American families lived in seriously deficient housing. To address that challenge, the federal government began building subsidized housing, and in the decades that followed, a complex array of federal programs evolved to tackle the continuing housing problems of low-income renters. Almost 10 years ago, the Urban Institute prepared a “primer”to assess this evolution. This brief is an update of major sections of that report, focusing on trends in national housing problems and federal housing assistance over the past decade. It shows that renter housing needs have grown substantially—almost totally because of unaffordably high rents rather than physical deficiencies—and federal housing assistance is not keeping up. The number of low-income renters that actually receive federal housing assistance has dropped notably as a fraction of the low-income households that need it. Evidence indicates that this gap will worsen.

. . . this brief explains the basics of US housing assistance to those unfamiliar with the field. After a summary, it (1) reviews recent changes in the number of US households by tenure and the nature of the housing problems renters face, (2) identifies the nation’s major federal housing assistance programs and explains how they work, (3) examines changes in the scale and spatial patterns of federal housing assistance and the characteristics of assisted households, and (4) identifies recent policy shifts and issues affecting future directions for these programs and pointing out literature offering fuller explanations. (1)

Its main findings include,

  • Household formation has slowed, and the renter share has significantly increased (mostly among the lowest-income groups).
  • Physical housing problems decline as the affordability challenge increases.
  • There are many more households with housing needs.
  • Since 2007, the number of households receiving HUD project-based assistance (in public housing or in privately owned subsidized projects) remained stable, while the number receiving housing vouchers increased.
  • But the modest increase in HUD deep-subsidy assistance has been overshadowed by growth in the need; the housing assistance gap has widened significantly.
  • The beneficiaries served by HUD programs is shifting away from families with children and toward the elderly and disabled.
  • The Low-Income Housing Tax Credit has been the fastest-growing US housing program over the past two decades. It does not necessarily add to the number of households receiving assistance, but it allows deep-subsidy resources to be spread among more households than would be possible without it.
  • Given forces at play, the housing assistance gap will likely worsen. (2-3)

There’s a lot more in the brief for those who want an overview of where we are with housing in the early 21st century.