A lot of this sounds like a modernized take on the Lower East Side circa 1905.
Rethinking Ways to Divide Living Space
By FRED A. BERNSTEIN
Terri Chiao, Deborah Grossberg Katz, Leigha Dennis, Joseph Vidich/Peter Gluck and Partners
A rendering of a town-house-sized lot, reconfigured as 20 small individual units.
IS there a mismatch between the housing New Yorkers need and the housing that gets built? Only 17 percent of dwelling units in the city are occupied by parents raising children under 25, according to the nonprofit Citizens Housing and Planning Council, but most new homes are designed with such traditional families in mind.
What is missing, housing advocates say, are homes for people who can afford only a little bit of space; living quarters large enough for four or more unrelated adults to share; and “accessory dwellings” for people who want to live close to family members who own single-family houses.
The absence of affordable housing for artists, actors, musicians and writers hoping to gain a foothold in New York is of particular concern. “We’re losing a lot of creative people to places like Buffalo and Berlin,” said Matt Blesso, a developer.
But developers like Mr. Blesso say city and state laws make it difficult to diversify the city’s housing stock. For example, it’s illegal to build units without kitchens and bathrooms or smaller than 400 square feet; and by law no more than three unrelated people are allowed to share a dwelling in the city.
David J. Burney, the commissioner of the city’s Department of Design and Construction, says “the regulatory environment has fallen behind” New York’s diverse population.
Last Monday, several architects presented their ideas for new types of housing for low-income New Yorkers. “We asked them to break the rules,” said Jerilyn Perine, the executive director of the Citizens Housing and Planning Council, which organized the conclave (along with the Architectural League of New York). Five city commissioners were on hand to critique the proposals.
Deborah Gans, an architect from Brooklyn, proposed adding tiny accessory units to a Tudor-style single-family house in Queens, some of them clinging to the original building. (Panelists referred to it as the barnacle approach.)
Rafi Segal, an architect who collaborated with Stan Allen Architect, also of Brooklyn, showed plans for a low-rise building in which prefabricated housing units would cluster around large light wells, with communal kitchens and shared bathrooms. It quickly became known as the urban kibbutz.
And a team headed by Peter Gluck, a Manhattan architect, showed how it might fit 20 small units — dubbed microlofts — onto one town-house-sized lot. Joseph Vidich, a young designer who worked with Mr. Gluck, said of the team members who are recent graduates struggling to find affordable housing, “We are part of the constituency we are designing for.”
Most of the designs were descendants of the once-common (and sometimes reviled) single-room-occupancy hotel. As Jonathan Kirschenfeld, an architect based in Manhattan, said while presenting his plans for buildings in the Bronx, “This is the S.R.O. redux.”
But not everyone was excited by that prospect. Robert D. LiMandri, the commissioner of the Buildings Department, said, “We need to enforce existing building codes, to keep people out of harm’s way.” Mr. LiMandri said that when he looks at some of the designs, “I think to myself, how is the fireman going to get in there?”
Other speakers questioned the viability of communal spaces. Ted Smith, an architect and developer from San Diego who is known for creating shared houses, said expecting a group to take care of a space is “always a mistake.”
And Mr. Smith was skeptical of the notion that convertible furniture — Murphy beds and desks that become dining tables — would make housing more affordable. “It costs more to buy the furniture than to make the room bigger,” he said.
Alexander Garvin, an urban planner, said designs involving windowless rooms might require so much electricity for lighting and ventilation that the cost savings would disappear.
But mostly the architects, activists and government officials were upbeat about the possibility of creating new housing types. “Everyone knows someone who would be well served by one of these designs,” Ms. Perine said. She said she was hoping to realize one or more of the designs in a pilot program, with government cooperation, and was also organizing a museum exhibition to bring the public into the discussion.
And Mr. Blesso said that if the laws were changed to permit some of the housing models he had seen, “I’d want to be the first to build it.”
A lot of this sounds like a modernized take on the Lower East Side circa 1905.
Looks like a dorm.
Kids don't seem to be bolting for the door at the first opportunity like they used to and are staying at home much longer now here in Oz. More for the perks, methinks.
As New Graduates Return to Nest, Economy Also Feels the Pain
By CATHERINE RAMPELL
As a result, she didn’t pay rent — or a broker’s fee or renters’ insurance, for that matter. She also didn’t buy a bed, desk, couch, doormat, mop or new crockery set. Nor did she pay the cable company to send a worker to set up her TV and Internet, or a handyman to hang a newly framed diploma. She didn’t even buy drinks and snacks for a housewarming party.
In other words, Ms. Romanelli, 22, saved a lot of money. But she deprived the economy of a lot of potential activity, too.
Every year, young adults leave the nest, couples divorce, foreigners immigrate and roommates separate, all helping drive economic growth when they furnish and refurbish their new homes. Under normal circumstances, each time a household is formed it adds about $145,000 to output that year as the spending ripples through the economy, estimates Mark Zandi, chief economist at Moody’s Analytics.
But with the poor job market and uncertain recovery, hundreds of thousands of Americans like Ms. Romanelli (and her boyfriend, who also lives with his parents) have tabled their moves. Even before the recession began, young people were leaving home later; now the bad economy has tethered them there indefinitely. Last year, just 950,000 new households were created. By comparison, about 1.3 million new households were formed in 2007, the year the recession began, according to Mr. Zandi. Ms. Romanelli, who lives in the room where she grew up in Branford, Conn., said, “I don’t really have much of a choice,” adding, “I don’t have the means to move out.”
Ms. Romanelli, who works as an assistant editor at Cottages & Gardens magazines, is one of the luckier “boomerang” children who have found jobs and at least can start saving for their own place someday. As of last month, just 74 percent of Americans ages 25 to 34 were working. It is perhaps no wonder then that 14.2 percent of young adults are living with their parents, up from 11.8 percent in 2007. Among young men, 19 percent are living with their parents.
But even some young people who can afford to move out have decided to wait until getting on more solid footing. Prudence, not necessity, has kept them at home.
Jay Bouvier, 26, has a full-time job teaching physical education and health and coaching football and baseball at a high school in Hartford, near his parents’ house in Bristol. He could rent his own apartment — after taxes he makes about $45,000 a year, he says — but has decided not to. He says he will stay with his parents until he has saved enough to buy his own house.
“I have it pretty good at home, since it’s so close to my work, and financially I just feel like it’s smarter for the long run to buy,” he said. He says that living with his parents enables him to set aside about half of each paycheck. “It’s like I pay rent, but to myself.”
By not paying rent, of course, he has deprived a local landlord and a host of other local companies of some income, as well as whatever businesses those purveyors might have patronized further down the line. It’s a phenomenon that John Maynard Keynes referred to as the “paradox of thrift”: Saving is good for the individual, but en masse can hurt the economy by reducing demand.
“Increased housing demand definitely has multiplier effects throughout the economy,” said Gary D. Painter, a professor at the University of Southern California and director of research for the university’s Lusk Center for Real Estate. “We have these sort of missing potential households,” he said, which also means “missing” sales and jobs in industries like retail, construction and manufacturing.
The actions of the young are self-perpetuating. Young people are reluctant to set off on their own until they have greater financial stability. But the economic conditions necessary to make them financially secure are difficult to achieve while consumers like them are still too nervous to start making big purchases, on housing or anything else.
Small indulgences are not totally out of the question, though.
“To be honest, for my first few real paychecks I’ve treated myself,” said Ms. Romanelli, explaining that she has not yet begun her plan to salt away half of each paycheck. “It’s only the first month or two, after all.”
Some economists are optimistic that there is considerable pent-up demand for new homes because so many young adults are reluctantly staying with their parents. Several of Mr. Bouvier’s friends, he said, are “itching to get out.” As soon as they find work, he says, they’ll leave.
“Once we get a little bit of job growth, or even expectations of better job market, those households are going to start breaking apart pretty fast,” said Mr. Zandi, of Moody’s Analytics.
Household formation probably won’t lead the recovery, but once set into motion by other good economic news it can “supercharge growth.” He estimates that there is pent-up demand for close to 1.1 million new households, which is approximately equal to the number of excess vacant homes for sale and rent.
“If these pent-up households were to form, then the oversupply of housing would be largely absorbed and housing construction would quickly ramp up,” he said.
Mr. Bouvier, now three years out of school, is hoping to move into his own house early next year, ideally a place that he can “fix up and turn into good investment.” He says he’ll hire a construction crew to help with the renovations.
“You know, they really should have kept that tax incentive for first-time home buyers,” he said. “I’m creating jobs after all. I thought that was a good thing.”
But with all the affluent individuals in the city completely ripping out all traces of previous ownership, you would think that NYC would have BILLIONS in business!!!!
Nice . This never affects employees of the NYCHA, obviously. It's not the fault of these residents that there is insufficient supply to meet the demand.
ELDERLY HOUSING PROJECT RESIDENTS ARE BEING TOLD TO MOVE AWAY
Elderly housing project residents, particularly at Amsterdam Houses in the West 60′s off of Amsterdam Avenue, are being told that they have to move because they live in apartments with more bedrooms than they need.
Some seniors are being told they have to move out of their developments — and even out of the borough, said Rosalba Rodriguez, a member of Councilwoman Gale Brewer’s staff who is working on the issue. Rodriguez said she’s been talking to residents of four housing projects she works with, including Amsterdam Houses, the Amsterdam Houses Addition, Harborview on 55th Street and Wise Towers on 92nd Street.
Rodriguez said that the New York City Housing Authority (NYCHA) has known for years that some of the units in the buildings are “underoccupied”, meaning that there are fewer people living in the apartments than it can hold (basically seniors who’s kids move out suddenly are living in two-bedroom and three-bedroom apartments by themselves). But NYCHA hasn’t been aggressive about pushing them out until now, and it’s freaking a lot of people out.
“They had never made these changes before,” she said. “It’s having health impacts on people.”
Rodriguez said she understands the need to make room for new families, but moving people out of their neighborhoods is unacceptable.
In a letter to NYCHA Chairman John Rhea sent last week, Brewer wrote that seniors are “alarmed.”
“It is widely recognized that seniors are vulnerable to physical and mental distress when uprooted from homes they have long occupied. They and their supporters are furious at the cavalier manner in which NYCHA is treating these residents, as though they are merely numbers to be shuffled about without regard to the harm this may cause. Ms. Curet has been in communication with NYCHA’s Family Services department and has made many referrals for assistance regarding these moves. However, she is deeply worried about the mental health of seniors who are under stress from NYCHA’s approach to downsizing.”
We contacted NYCHA for a response (Rhea apparently hasn’t responded to Brewer yet), and received the following from spokesperson Zodet Negron.
“The New York City Housing Authority faces a real crisis with more than 161,000 people on its waiting list for public housing (and another 120,000 waiting for a Section 8 vouchers). There are nearly 50,000 people in NYCHA housing units who are not living in apartments properly sized for their needs – meaning they have too many rooms for their family size. To serve families in need, it is critical that NYCHA utilize this scarce public resource as it was intended: to assist the greatest number of families eligible for affordable and subsidized housing. We will continue to work with residents as their case is reviewed annually to explore and discuss how best to meet their needs. NYCHA also will assist other families who can be better accommodated once under-utilized apartments become available.”
Negron added “This is not new, as each resident’s lease states this possibility.”
Asked why residents were being asked to move out of their neighborhoods, and even their boroughs, Negron responded: “NYCHA works with the residents to place them in an appropriately-sized unit where available. This could be within their own development or borough but it will depend on availability. For certain developments and boroughs, the wait can be longer.”
The problem is simple. they have to PLAN this stuff out ahead of time. Moving the elderly to a smaller abode can be reasoned (would you rather grandma had a 3BR while a new family with 3-4 kids or inlaws is stuck in a 1BR?)
Where this falls apart is the poor planning that forces these guys to move to a different building, or different neighborhood. Maybe a stipulation has to be made that these guys can only be downsized when something in their building, of similar condition (or refurbed after vacating) is available.
When a 1BR becomes free, refurb it, put some new appliances and amenities in there, and then move these folks into there. Do not tell them they have too much and move them out to Queens.
A bit of good news.
Home-Crisis Program Gets A Late Start
By JOSEPH DE AVILA
After three years of slow progress, a $53.9 million New York City program to help neighborhoods hit hard by the housing market collapse is finally showing a tangible result: people moving into empty, foreclosed homes.
A nonprofit housing developer working with the city has acquired more than 80 vacant homes primarily in southeast Queens and has rehabbed and sold three of them recently to buyers. Among the new homeowners is Betty Miller, 44 years old, who bought a four-bedroom house in November in the Jamaica section of Queens for $250,000.
"This really helped a lot," said Ms. Miller, who works as a school safety agent for a public school in Brooklyn. "I wanted to have something to pass on to my children."
The city effort is part of a $7 billion federal initiative called the Neighborhood Stabilization Program, launched in 2008 in response to soaring foreclosure rates. The city and federal campaigns have faced criticism—a slow rollout on the local level, not enough funding on the national level—but officials said they are now making progress.
To be sure, New York City's foreclosure rates don't compare to areas like Nevada or Florida. But the city and a nonprofit it hired for the program—Restored Homes Housing Development Fund Corp.—have focused on areas where there are large clusters of bank-owned homes, such as Jamaica and the Bedford-Stuyvesant section of Brooklyn.
"Southeast Queens is ground zero for the foreclosure crisis," said Salvatore D'Avola, executive director of Restored Homes. "The goal is to stop the cycle of the foreclosure and stabilize these communities."
In 2008, the city hired Restored Homes to buy up to 100 vacant foreclosed homes to rehab and resell to new buyers. The Furman Center for Real Estate and Urban Policy estimates about 1,500 such homes exist in the city, down from 1,800 in 2009.
"Bringing these homes back to life will really be a significant impact," said Peter Madden of the city's department of Housing Preservation and Development, which runs the program locally.
For example, Restored Homes bought a foreclosed home in Jamaica for $277,000 and spent $30,000 rehabbing it. The nonprofit then sold the home to Ms. Miller and her husband at a below-market rate of $250,000. The couple couldn't have afforded the home without the program, she said.
Another part of the city's plan is to provide up to $80,000 in forgivable mortgages to homebuyers to purchase foreclosed homes. The New York Mortgage Coalition, a nonprofit housing group hired for the project, wants to make about 50 loans to people who have been vetted by financial counselors.
"It's important to get those homes as soon as they become vacant. Otherwise, it just gets worse and worse," said Adam Marcus of the mortgage coalition.
HPD is also using the $53.9 million in Department of Housing and Urban Development funds to hire other developers to rehabilitate several foreclosed apartment buildings.
The city and its nonprofit partners said the program's rollout in New York started slowly mainly because they had to learn complex federal reporting standards and had initial difficulties identifying eligible foreclosed properties. "There has definitely been a learning curve," said Lindsay Haddix, an HPD official who oversaw the program's first phase.
When NSP was announced, housing groups were thrilled, but many questioned what it could achieve. In November, the Federal Reserve Bank of Richmond said in a report: "NSP funds, while significant, were simply insufficient to address the scope of the foreclosure problem that exists nationally."
There were 1.9 million loans nationwide in foreclosure at the end of June 2011, and that figure is expected to rise, the Richmond Fed said. In New York City, about 72,000 residential foreclosures have been initiated since 2007, according to real-estate website PropertyShark.com.
The report said NSP wasn't a "silver bullet" for the foreclosure crisis, but "it may end up serving as a first step."
Last year, the program came under fire in Congress from Republicans who charged it lets lenders and real-estate speculators off the hook for bad loans.
Its defenders said vacant homes contribute to neighborhood blight and hurt property values. "We recognize the scale of the problem, but we're also seeing communities across this country using NSP in a strategic and targeted way to tackle these challenges," said Mercedes Márquez, an assistant HUD secretary.
NSP's impact on the ground won't be known for at least a year. The city has until February 2013 to spend the rest of its federal money on up to 20 homes.
"It got off to a slow start," said Craig Nickerson of the National Community Stabilization Trust, a group that coordinates sales banks and nonprofits participating in federal program. But "we are seeing neighborhoods beginning to re-stabilize."
It seems pretty unconscionable that a decision like this can be made without any alternatives to offer and seemingly no thought for the consequences.
Building more homeless shelters is NOT the solution, either , just throwing money at the symptoms of the problem, with no thought for the long-term.Mayor Bloomberg previously warned that discontinuing the Advantage program would mean the city would need 70 new shelters to provide housing for those no longer receiving rental subsidies, costing upwards of $80 million.
Halt of Rent Subsidies Will Push Formerly Homeless Into Street, Critics Say
By Jill Colvin
MANHATTAN — Advocates are warning that thousands of families could be pushed out onto the streets after the Department of Homeless Services announced it will not be sending out rent-subsidy checks to formerly homeless families this month.
A legal challenge brought on behalf of tenants by the Legal Aid Society had forced the city to continue funding the program after state and federal cuts last year, but the appellate division of the New York State Supreme Court lifted an order Thursday, permitting the city to stop payments.
The DHS-adminstered Advantage program provides working families who are homeless with rental subsidies so they can move out of shelters and into their own homes. There were 15,000 people participating in the program and 3,000 qualified to join as of last March.
Following Thursday's ruling, the Department of Homeless Services announced on its website that the city has immediately ceased issuing checks.
“The City will NOT be paying the February rent subsidy,” read the notice, advising tenants to attend an information session offering eviction-prevention counseling and free legal help instead.
Advocates warned the move will create an “immediate” crisis for those who rely on the checks.
Mary Brosnahan, executive director of the Coalition for the Homeless, said that at least 8,000 homeless families were “at immediate risk of being evicted from their homes in the middle of winter,” and that many, “if not most,” will be forced to head to homeless shelters.
“Michael Bloomberg is now the first mayor in modern history with no program whatsoever to move people out of shelters and into affordable homes,” she charged. “His legacy is the sad result of this failed approach, and New York’s all-time [homeless] record is sure to grow worse as the city rushes to cut off Advantage families from the help they were promised.”
Public Advocate Bill de Blasio said the administration is at risk of driving thousands of families into homeless shelters, “which are already close to the breaking point.”
He said in a statement that the Bloomberg administration was "throwing away everything we have learned about preventing homelessness and helping families get back on their feet in the process."
Program recipient Karen Ruth, 44, who is raising a 13-year-old son in Bedford-Stuyvesant, said she doesn't know what she'll do without the help, which she began receiving from the city after they spent two months in homeless shelters in 2009.
“I’m very aggravated right now. Frustrated and emotional," said Ruth, who said she is legally blind and receives $1,000 a month through the Advantage program, which helps her afford her $1,305 a month rent.
“Without that help, I have no way to live," she said, adding that she hasn't yet broken the news to her son. "I would be homeless yet again, without the help of that voucher."
In a statement Friday, DHS Commissioner Seth Diamond said the Advantage program had been a success, but that without state and federal help, the cost was too much for the city to shoulder on its own.
"It is too expensive without shared responsibility," he said, adding that the Department "will continue to work aggressively to prevent and end homelessness in the absence of State and federal assistance."
DHS did not respond to mulitple requests for comment regarding how the agnecy planned to deal with those no longer receiving the checks.
Mayor Bloomberg previously warned that discontinuing the Advantage program would mean the city would need 70 new shelters to provide housing for those no longer receiving rental subsidies, costing upwards of $80 million.
The sides will be back in court on Feb. 9 for oral arguments, a spokeswoman for the city's Law Department said.
Mike just has not gotten the "relocation buses" ready for the February rush to NJ.
Homeless problem? What homeless problem?
So somehow state and federal cuts are Bloomberg's fault? How do you suggest he make up the cuts?
You can go right back to "Why does NYC have to support most of NYS, and indeed the COUNTRY?"
People seem to forget how much the citizens of NY and other major metros, not the corporations, fund the tax roles of the nation. Somehow you get an equal voice to say what you want to do with the money even when you had little to do in providing it.
On the flip side, following THAT tenet would make the corporations our rulers.... legally as well as "behind the scenes".
Still, that doesn't go to the question of why blame Bloomberg for it. Go after Cuomo, Silver, and whoever the hell is running the state senate, not to mention congress and Obama. Really, Bloomberg is at the bottom of the list on this one.
I think it is a shared responsibility.
I am not for running one stooge up the yardarm when it comes to finding fault in politics and public policy.
Forgiveness of Debt Could Yield Savings
by NICK TIMIRAOS
As the regulator for Fannie Mae and Freddie Mac nears its decision on whether to approve debt forgiveness for troubled borrowers, a new analysis by the regulator suggests taxpayers could benefit from the move, according to people briefed on the findings.
Fannie and Freddie could save about $3.6 billion more than current loss-mitigation approaches by reducing balances for some borrowers who owe much more than their homes are worth, these people said.
The Federal Housing Finance Agency is nearing a decision on whether to allow the companies to participate in the debt-forgiveness program that it consistently has resisted.Until now, the Federal Housing Finance Agency has maintained that the current housing-rescue programs offered by the taxpayer-supported mortgage companies are less-expensive options.
The new analysis was done because the Treasury Department said in January it would pick up part of the tab if the companies would reduce principal balances when modifying mortgages for troubled borrowers. It would use unspent housing funds from the $700 billion Troubled Asset Relief Program.
The Obama administration has argued strongly in favor of the FHFA adopting the principal-reduction program for Fannie and Freddie, saying it would provide more sustainable loan modifications.
"We think there's a set of cases where it's clearly in the interest of the taxpayer for them to do principal reduction upfront," said Treasury Secretary Timothy Geithner in congressional testimony earlier this year.
In April, the agency said that loan forgiveness would save about $1.7 billion for the companies, relative to other types of relief. At the time, the agency said that because the Treasury was paying to subsidize those write-downs, the relief would still cost taxpayers $2.1 billion, offsetting any savings to the companies.
But the latest analysis done by the agency found that such write-downs would generate $3.6 billion in savings for the companies, under certain assumptions, according to people familiar with the analysis. Even after subtracting the cost of the Treasury subsidies, the program would save $1 billion, these people said. As many as 500,000 borrowers could be eligible, these people said.
Spokeswomen for the Federal Housing Finance Agency and the Treasury Department declined to comment.
The FHFA has raised other concerns beyond the cost of such write-downs. Chief among them is the fear that more borrowers, upon hearing that Fannie and Freddie are instituting a debt-forgiveness program, might default to seek more generous terms. Fannie and Freddie were taken over by the U.S. government four years ago and have cost taxpayers about $145 billion.
A related worry is that unlike banks, which sometimes cut debts on loans they own, Fannie and Freddie would have to rely on hundreds of mortgage companies that manage payments on their behalf, creating greater operational headaches.
The Treasury Department rolled out the debt-forgiveness program in 2010. Fannie and Freddie opted against participating. The initiative, part of the administration's Home Affordable Modification Program, is open to homeowners who have missed their mortgage payments or face imminent hardship and who owe more than their homes are worth.
The program has been increasingly adopted by mortgage servicers that handle deeply underwater loans which aren't guaranteed by Fannie and Freddie. To qualify, homeowners must make at least three payments under the reduced loan amount, and principal balances are cut in installments over three years. The median principal amount reduced under the program has been $69,000.
Separately, Freddie Mac is preparing to expand rules devised to boost refinancing for borrowers with loans that the company guarantees, according to people familiar with the matter. The company currently allows its borrowers who are underwater or who have less than 20% equity to refinance with reduced documentation and fees under the Home Affordable Refinance Program.
The coming change will allow all borrowers with loans backed by the company, regardless of their loan-to-value ratio, to benefit from the streamlined program. Fannie Mae had already extended the HARP program to all borrowers, regardless of their equity position.
The FHFA last fall announced a sweeping revision of HARP guidelines, including eliminating a previous cap that limited the program to borrowers who owed up to 125% of their current property value.
But the Obama administration had been critical of the decision not to open up the program to borrowers with more home equity. "Have you ever heard of any program in any country at any time in history where borrowers with better collateral got a worse deal, or are even shut out altogether?" said Gene Sperling, director of the White House's National Economic Council, in a speech to the National Association of Realtors in May.