Tag Archives: Rent Guidelines Board

NYC’s Housing Supply

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The New York City Rent Guidelines Board (of which I am a member) released its 2017 Housing Supply Report. It has a lot of interesting data for housing nerds as well as those of us obsessed with NYC. Here is a taste:

  • There are a total of 3,217,521 units of housing.
  • 2,184,295 are rental units.
    • 848,721 are non-regulated rentals.
    • 1,335,574 are regulated rentals in one form or another (rent stabilized, rent controlled etc.)
  • 1,033,226 are owner units.
    • 116,134 are condos
    • 330,679 are coops
    • 586,413 are conventional homes.

Some other highlights include,

  • Permits for 16,269 new dwelling units were issued in NYC in 2016, a 71.2% decrease over the prior year and the first decrease since 2009.
  • There was a 31.3% decrease in the number of co-op or condo units accepted in 2016, to 282 plans containing 8,671 units.
  • The number of housing units newly receiving 421-a exemptions decreased 17.8% in 2016, to 4,493.
  • The number of housing units newly receiving J-51 abatements and exemptions decreased 22.5% in 2016, to 34,311.
  • The number of new housing units completed in 2016 increased 61.9% over the prior year, to 23,247.
  • Demolitions were down in 2016, decreasing by 2.0%, to 1,849 buildings.
  • City-sponsored residential construction spurred 23,408 new housing starts in FY 2016, 74% of which were rehabilitations.
  • The City-owned in rem housing stock declined 70.2% during FY 2016, to 125 units. (4)

For those who do not know the byzantine world of NYC housing policy, 421-a exemptions relate to new construction and J-51 abatements relate to renovation of existing construction. It is interesting to see how policy changes impact housing construction.

Any one year’s figures provide just a snapshot, so if you really want to get a sense of the big picture, you should check out the earlier reports too. For instance, last year’s report stated that there were permits for 56,528 new dwelling units in 2015, an increase of 176% from 2014.  This is way more than the long term trend. Permits for new dwelling units never got much higher than the low thirty thousand range but fell to a low as six thousand during the depths of the Great Recession.

When you realize that the 421-a tax abatement was set to expire at the end of 2015, this big jump in permits makes sense as developers filed a ton of permits to take advantage of the program while they could. It will be interesting to see how the new 421-a regime will impact permits for new construction going forward.

Rent Regulation and Housing Affordability

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NYU’s Furman Center issued a fact brief, Profile of Rent-Stabilized Units and Tenants in New York City, that provides context for the deliberations of the Rent Guidelines Board as it considers a rent freeze for NYC apartments subject to rent stabilization.

Rent regulated (rent stabilized and rent controlled) apartments clearly serve households that have lower incomes than households in market rate apartments. Median household income (fifty percent are below and fifty percent are above this number) is $37,600 for rent regulated and $52,260 for market rate households.Thus, market rate households have median incomes that are nearly 40% higher than rent regulated ones.

The median rent is $1,155 for rent regulated and $1,510 for market rate households.Thus, median rents are about 30% higher for market rate tenants.

Despite these differences, the number of households that are rent burdened (where rent is greater than 30% of income) is similar for the two groups: 58% for rent regulated and about 56% for market rate households. (4, Table D)

The Furman Center brief provides a useful context in which to consider NYC’s rental housing stock as well as the households that live in it. Given the nature of NYC households, however, I would have wished for a more finely detailed presentation of household incomes and rents.

NYC’s distribution of income is skewed toward the extremes — more low-income and high-income households and therefore fewer middle-income ones than the rest of the nation. Given this, it would have been helpful to have seen the range and distribution of incomes and rents, perhaps by deciles. The Furman Center brief indicates that updated data will be available next year, so that may provide an opportunity to give a more granular sense of dynamics of the NYC rental market.

Mayor de Blasio’s housing plan outlines his commitment to preserving affordable housing. One element of that commitment is to preserve rent regulated housing. Understanding that market sector and the households it serves is essential to meeting that commitment.