There are still a few hundred loft buildings covered under the Loft Law where the owners have failed to fully up-grade to residential code requirements. Hence the buildings do not have a residential C/O. Without the Loft Law the residential occupants of those buildings would have no protections. There is no good reason that, after 20+ years, owners of those loft buildings haven't fulfilled their legal requirements -- aside from the distinct probability that they are flouting the law in order to force protected tenants out of their homes.
PS: If there were a financial hardship situation then the owners could have vailed themselves of that aspect of the law, so claiming "hardship "is no good excuse.
I'm amazed that nobody has challenged these laws in court. Can one really engage in housing discriminatation based on employment?
Get rid of the law. Everyone knows Soho is extremely wealthy and not particularly artist-oriented. How many non-wealthy artists under the age of 50 live in Soho (or anywhere downtown, for that matter)?
NYS Legislature recently RENEWED / EXTENDED the Loft Law for another year (through May 2008) -- as they have done regularly for the past many years.
Per the NYC Loft Board regarding non-compliant Interim Multiple Dwellings (IMD buildings):
September 13, 2007
Housing Takes Bigger Bite of New Yorkers’ Incomes, Census Data Shows
By MANNY FERNANDEZ
The burden of housing costs continues to stretch the pocketbooks of New Yorkers, as large percentages of residents see more of their income go to their mortgages and rents, according to an analysis of new census data.
Across the city, homeowners in Brooklyn and renters in the Bronx are carrying the heaviest burdens, with many spending half or more of their monthly paychecks on housing.
In Brooklyn, 31 percent of homeowners with a mortgage are spending 50 percent or more of their income on housing costs, the highest percentage in any large county in the state. In the Bronx, 32.9 percent of renter households are paying a similar share of their income for their apartments, the highest percentage in the city, according to an analysis of the Census Bureau’s 2006 American Community Survey, which was released to the public yesterday.
Zulma Solorzano, a 32-year-old single mother, lives in a one-bedroom apartment in the Bronx with her 8-year-old daughter, Elisa Castro. She figures she spends 57 percent of her income on rent, earning $645 every two weeks as a part-time public school teacher and paying $790 for rent.
Her life has become a series of small sacrifices. She used to spend $60 a week on groceries, but now she spends $40. She recently had to get a second job, working as a sales clerk at the Gap. She would like to go back to school to get a master’s degree, but cannot afford the tuition. She wanted to become more active in her neighborhood by working with the Northwest Bronx Community and Clergy Coalition, but never has the time. About two weeks ago, she cut off her cable television service.
“It was hard to say to a little kid, ‘I cannot afford it anymore,’ ” Ms. Solorzano said, adding: “It’s really frustrating. I’ve been struggling for a long time.”
The latest data, when compared with census results from 2005, illustrates the speed with which New York City housing is becoming increasingly expensive.
Ismene Speliotis, executive director of New York Acorn Housing, a nonprofit housing organization, and other advocates for low- and moderate-income housing said several factors were putting the squeeze on homeowners and renters.
Stagnant incomes have not kept pace with rising rents. Gentrification and the rapid loss of subsidized rental housing have also pushed housing costs up for low- and moderate-income families, housing experts said. At the same time, the proliferation of low-interest and risky subprime mortgages, while increasing homeownership numbers, has led to more foreclosure filings in the city.
“We’ve seen a huge increase in defaults and foreclosures in Brooklyn, in East New York, East Flatbush,” Ms. Speliotis said.
In 2006, 26.4 percent of homeowners with a mortgage in the city paid half or more of their income on housing, up from 25.4 percent in 2005, according to the analysis conducted by Queens College demographers for The New York Times. About 49.8 percent of homeowners with a mortgage in the city were paying 30 percent or more of their income on housing, a level commonly viewed as a limit of affordability, compared with 48.8 percent in 2005.
In Brooklyn, 55.3 percent of homeowners in 2006 paid 30 percent or more of their income on housing. Homeowners there had the second-highest median monthly costs in the city, at $2,194. Those in Manhattan had the highest, with $2,758.
For many poor and low-income renters driven out of Upper Manhattan, Brooklyn and Queens by rising rents, the Bronx has become a last refuge. The borough has the cheapest median gross rent in the city, at $826 a month.
“Lower-income people being squeezed out of other parts of the city are moving to the only place they can still afford,” said Gregory Lobo Jost, deputy director of the nonprofit University Neighborhood Housing Program.
Even with the cheapest rents, the Bronx is the only borough in which the people moving in make less than the people already living there, the group found in a report released earlier this year.
The new census figures echo the research many community groups have already done on New Yorkers’ housing burdens. A study by the Community Service Society of New York found that the city’s low-income families, after spending much of their income on rent, are left with only $32 a week per family member.
“It’s disappointing but not surprising that in 2006 these trends are continuing,” said Julie Miles, executive director of Housing Here and Now, a coalition of housing advocates and community groups. “Families constantly are having to choose between essentials, between food costs and health care costs and energy costs, and housing.”
The city’s median gross rent climbed to $945 a month, up from $909 in 2005. Manhattan remains the most expensive borough for renters, with the median rent at $1,081, according to the census data. Renters in the city spending at least half their income on housing remained unchanged from 2005 to 2006, at 27.9 percent.
The burden of housing costs, though high in New York City, is by no means the highest in the country.
In Lawrence, Mass., 42.1 percent of homeowners with a mortgage were spending 50 percent or more of their income on housing, the highest percentage among cities in the country with more than 65,000 people, according to the analysis. In Newark, that figure is 34.7 percent, far higher than New York City’s 26.4 percent.
Victorville, Calif., had the highest percentage of renters paying at least half their income on housing among cities with more than 65,000 people, at 48 percent. Close behind was Muncie, Ind., at 47.9 percent.
Copyright 2007 The New York Times Company
Fed Says Make Money by Selling Housing Projects
October 24, 2007
Yesterday, the New School held a forum to discuss how New York City will save its public housing. The New York City Housing Authority, which is the city's primary sources of affordable housing to 400,000 residents, has an annual shortfall of $225 million.
The Daily News reports that Sean Moss, the Regional Director for the Department of Housing and Urban Development in the NY/NJ region, offered a suggestion that "prompted shocked murmurs." His idea: Sell some of the Housing Authority's buildings in expensive neighborhoods. "It may displace some people, and that is a concern...That is not necessarily a bad thing if you can create more housing with that. Instead of having 300 units [in a project], maybe there is a way to increase that if they are able to...sell those assets so that you can create more housing." There are some NYCHA developments in neighborhoods full of new, luxury development, but would that mean lower-income families would be shifted more remote places?
Some others on the panel were more cautious. Teamsters Local 237 president Gregory Floyd said, "We have something that's working. We would like this to be improved." And City Council member Rosie Mendez suggested the city help out by not charging the NYCHA for "police services, water, trash pickup and senior programs."
Last year, NYCHA chairman Tino Hernandez proposed a seven-point "Plan to Preserver Public Housing," which included a limited rent increase and use of Section 8 funding to support operations in 8,400 units.
2003-2007 Gothamist LLC.
---------------------------------------------------
Feds eye New York building sale at housing projects
BY ADAM LISBERG
DAILY NEWS CITY HALL BUREAU
Wednesday, October 24th 2007
New Yorks top federal housing official said on Tuesday the city's cash-strapped Housing Authority should consider selling buildings in expensive neighborhoods to create more apartments elsewhere.
"It may displace some people, and that is a concern," Sean Moss, the regional administrator for the federal Housing and Urban Development Department, said at a forum on the Housing Authority's future.
"That is not necessarily a bad thing if you can create more housing with that," Moss said. "Instead of having 300 units [in a project], maybe there is a way to increase that if they are able to ... sell those assets so that you can create more housing."
Moss' frank comments prompted shocked murmurs among the dozens of housing advocates at the forum, organized by the New School's Center for New York City Affairs.
Gregory Floyd, president of Teamsters Local 237, which represents many Housing Authority workers, worried developers are already eying authority projects in valuable neighborhoods, which would curtail affordable housing options there.
"We have something that's working," Floyd said. "We would like this to be improved."
Other housing authorities have torn down dilapidated high-rises and replaced them with new low-rise buildings elsewhere, but New York's projects have been well managed in the past and provided solid middle-class housing for decades.
The Housing Authority and the city Housing Preservation and Development Department have sold parking lots at some Manhattan projects so developers can put up new apartments. Housing Authority General Manager Douglas Apple said the agency may also build new stores on its sites.
Federal cutbacks have left the authority with a $200 million annual shortfall, which has hurt services and maintenance for its 400,000 residents.
City Councilwoman Rosie Mendez (D-Manhattan) said the city should consider putting millions into the Housing Authority - or at least stop billing the agency for police services, water, trash pickup and senior programs.
"We in city government need to pick up some of the slack and pay for that," Mendez said.
© Copyright 2007 NYDailyNews.com.
Why don't they just rent some of these houses out to cover the costs of the other units?
I know it sounds bad, but if you have prime real estate, and a budget shortfall, make it so that the money that people are willing to spend goes towards saving places that need it.
I see this as a good thiong, but I know the money will mysteriously dissappear.
You get 300 units that you can rent at at least $2000 a month, you are talking $6M a month. $72M a year. Not exactly enough to cover the shortfall, but 300 units is one building.
How far would they have to push people out to make the system balance? How mean do they have to be to save something than may not bode well if it is forced to survive on its own?
What is the lesser of two evils?
Selling is just stupid. That is money that will find other pockets.
Politicians Can't Back Sell-The-Projects Idea
Brownstoner
November 14, 2007
Unsurprisingly, a group of legislators has a serious bone to pick with HUD regional director Sean Moss over his recent comments that selling some public housing developments might help solve New York's affordable housing crisis. A letter addressed to HUD secretary Alphonso Jackson that was signed by 14 assemblymembers (including Joan Millman and Hakeem Jeffries) makes the case that selling public housing is in no way a long-term solution for the city's housing crisis:
At issue is the assertion that mass displacement of residents in one neighborhood, would benefit residents of another. At the very least, this assertion is misguided. The existing NYCHA developments are of much more value, to both the number of individuals which they provide shelter to as well as the diverse communities they help foster, than a short term budget windfall. Likewise, any purchase and/or development of affordable housing, short of new construction of full scale NYCHA developments, would be comparatively wasteful of the suggested sales proceeds and could by no means accommodate the same numbers of residents currently served by existing developments. In short, a sale of NYCHA properties would be a 'one-shot' deal, and would offer very few benefits for those in need of public housing extending past the year of the sale.Full text of the letter on the jump.
HUD Official Speaks the Unspeakable: Selling The Projects [Brownstoner]
+++
The Cambridge Model
Rent deregulation made town spiffy, homogenous, unaffordable
Illustration by Nigel Holmes; Source: Manhattan Institute
NY OBSERVER
by Tom Acitelli
November 13, 2007
Whenever New Yorkers debate rent stabilization, they quickly ask one question: What would happen to the city’s apartment market if its 1.04 million rent-stabilized units were deregulated? Luckily, we have one good example of what would happen: the Boston area.
In 1994, Massachusetts ended rent regulations on most apartments. Boston and its suburb Cambridge were among the state’s few municipalities that still had wide-scale controls on apartments that kept rents below market. In Cambridge, two-thirds of apartments in buildings with at least four units were regulated.
Within a few years of deregulation, rents were way up, especially in Cambridge, a city of about 100,000 where tenants are similar socioeconomically to those in New York and where the housing stock is also similar. Over the same few years, landlords invested more in the formerly rent-regulated apartments they owned, improving the physical conditions and therefore helping to improve some Cambridge neighborhoods.
Henry Pollakowski, a housing economist at M.I.T.’s Center for Real Estate, did a study of the effects of Cambridge’s deregulation. The report, released by the conservative Manhattan Institute in 2003, found landlord investment increased through 1998 by about 20 percent over what it would have been had the city maintained rent regulation. Landlords, too, spread this investment over both affluent and poorer neighborhoods.
The report concluded that this “tremendous boom in housing investment” could happen in New York City should it deregulate its stabilized apartments. “… [T]he Cambridge experience suggests,” Dr. Pollakowski wrote, “that if New York’s policymakers wish to achieve significant improvements in housing quality in New York, they should give serious consideration to deregulation.”
But the physical improvements in formerly stabilized apartments would drive up rents and likely change forever the demographics of some of the city’s most prominent and desirable neighborhoods.
Another study by Dr. Pollakowski concludes that New York rents in the short term would rise following deregulation. In the long term, it’s anyone’s guess; but it seems likely New York rents, once all market-rate, would jump so much as to render today’s already high prices quaint, like stories now of $100,000 Central Park West co-ops in the 1980’s.
Again, look to the Boston area.
“Five years after Massachusetts voters ended rent regulation … in Boston, Brookline and Cambridge,” began a New York Times article from July 2000, “rents have taken sizable jumps, the cities are spiffier and less pockmarked by deteriorating neighborhoods and many poorer people have been forced to move to communities farther from the urban core. … [A] leading landlord in Cambridge found that rents for his company’s formerly controlled apartments have doubled.”
More striking than any post-regulation rent jumps in New York would be how expensive and exclusive some neighborhoods in particular would become. Dr. Pollakowski’s report suggests a mere $8 as the median monthly increase in the first two years for stabilized apartments citywide.
But most stabilized apartments are in more affluent neighborhoods, including the lower two-thirds of Manhattan. These neighborhoods are already some of the least diverse economically and socially in the city. Quite simply, the already high costs of living, including rents, keep out many New Yorkers and create ample and understandable fodder for those who lament the city’s gentrification.
Take away rent stabilization and this gentrification would only grow. Think the Upper West Side’s homogenous now? Wait until you see it with higher rents—Dr. Pollakowski’s report pegged a median monthly rent increase of over $200 post-deregulation; and this was before the spikes in rents this year.
Higher rents will draw wealthier renters; the wealthier renters will attract higher-end retail; the higher-end retail will force out the mom-and-pop retailers; and, pretty soon, today’s gentrification will seem as modest as the price of a diner cup of coffee—which is also likely to increase.
The above scenario may seem hyperbolic. But look northward.
Boston Mayor Thomas Menino’s office told The Times in 2000 that the average rent for a two-bedroom apartment in that city had jumped 75.1 percent from 1995 to 1999 to $1,550. It’s much higher now. A search last Friday on Craigslist for all one-bedroom apartments in New York City and Boston showed similar ranges of rent: Here, one-bedrooms ranged from about $1,500 to $3,000-plus; in Boston, from $1,200 to $2,000-plus.
Boston’s low apartment-vacancy rate—a report from investment-sales firm Marcus & Millichap pegged it at near 5 percent this year, about twice that of New York’s—ensures that rents stay high. Part of that tenant demand stems from the gentrification this decade of Boston and some of its suburbs; and part of that gentrification stems from rent deregulation.
Boston and Cambridge are much more expensive cities to rent in than they were before deregulation—and huge swaths of both have changed, perhaps irrevocably. This is fabulous news for landlords and for residents who can afford rents that rose 75 percent in four years. For everyone else, it’s a warning.
And I bet in Boston average income, eductional level, and the tax base are up, and crime and social service costs are down. The were very smart to get rid of rent regulation. The people who are there now are better off.
We should do the sme thing here.
loss of rent regulated apts
In effect, we already are -- the number of rent-regulated apartments is dropping as units cycle out of the system.
As an owner, this benefits me economically -- but I find it heinous in terms of social costs. It's bad for old people, it saps the economic engine of the city as newcomers face ridiculously long commutes, and it's making a city of neighborhoods into one big strip mall.
ali r.
{downtown broker}
What Ali said, exactly.
Actually it would be newcomers who would do the best if rent regulation were eliminated. A large number of the old timers, who can only afford to live in NY because they pay a ridiculously low rent would be forced out. This would create, for the first time in modern history, a fairly lose rental market (it a reasonable vacancy rate). This would bring down marginal rents (the rent someone would have to pay for a newly rented apt), significantly. So those newcomers could do much better than they could now.
Basically we'd be trading a lot of retirees for starting professionals.
Originally Posted by Front_Porch
Mike W: Your scenario ^ is NOT what happened in Boston ...
Boston Mayor Thomas Menino’s office told The Times in 2000 that the average rent for a two-bedroom apartment in that city had jumped 75.1 percent from 1995 to 1999 to $1,550. It’s much higher now. A search last Friday on Craigslist for all one-bedroom apartments in New York City and Boston showed similar ranges of rent: Here, one-bedrooms ranged from about $1,500 to $3,000-plus; in Boston, from $1,200 to $2,000-plus.
Ali and Schade,
I couldn't agree more. I am not anti-development, or progress, or whatever, as long as it is balanced. But how much less vibrant is this city becoming? I was in Rome this summer and I was enchanted. It felt so alive. I'm afraid that I'm one of those who kind of felt (perversely, I'll admit) that Billy's Topless in Chelsea was a bit iconic. Real life is full of so many different kinds of people, and we don't seem to be embracing them at all. I love talking to the old-timers, the wonderful barbers who have been around for 60 years and cut my husband's hair.
As Kramer said to Jerry, there have to be some standards. If we feel that way about it, we might as well get in the car and drive to the east side. Except that now (with a few exceptions, including LES and Harlem) it's all seems to be becoming rather soulless.
Mike W. and Lofter,
I think New York would be a bit different than Boston (not the rosy picture that Mike W. paints, but somewhere in between), but still socially reprehensible. The system is awful, but a rapid deregulation is a sick thought. Even the destabalization rate of (I believe) $2000 is a sham. There are many people in this city who are approaching that rate, and this has been New York's way of largely getting people out of the system without flooding the market and avoiding excessive criticism. As Ali says, it essentially works the same way, only longer term.
Boston neighborhoods in the late 80s/early 90s (usually) were either good, or they were bad. When rents were deregulated it allowed landlords, who proved themselves up to the task, to refurb apartments and take the time to fill them with much higher income tenants at much higher rents. Boston is a lovely city, with a huge college base, and this change encouraged many people to reconsider Boston (over New York). Boston pay was lower, but even with the increase in housing costs, it seemed more affordable to many.
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