The nine-member rent council (RGB) on Tuesday voted to raise rents by 3.25 per cent on one-year leases and by 5 per cent on two-year leases, the highest increase for rent-stabilized flats since 2013.
Adi Talwar
A Bronx residential building with rented apartments on the corner of West Mosholu Parkway North and Knox Place.
Tenants in New York City’s approximately 1 million regulated apartments are facing the largest rent increase since the Bloomberg administration.
The nine-member rent council (RGB) voted on Tuesday to raise rents by 3.25 per cent on one-year leases and by 5 per cent on two-year leases, marking the highest increase for rent-stabilized flats since 2013. That year was the last year. of Mayor Michael Bloomberg’s tenure, the board raised rents by 4 percent. Under Mayor Bill de Blasio, the board never raised rents by more than 1.5 percent and on three occasions the rent froze for the only time in the five-decade history of rent stabilization.
RGB chairman David Reiss, a de Blasio nominee, presented the proposal when tenants who had called for rent freezes or rollbacks mocked in the Cooper Union auditorium where the vote was held.
“I believe this proposal best balances the needs of landlords who have to pay for costs that rise significantly, as well as tenants who still have to deal with the long-term effects of the pandemic,” Reiss said.
He mentioned the rising cost of fuel, insurance and maintenance for landlords, while also acknowledging that “rent-stabilized housing is unaffordable for many tenants.”
The board’s two tenant representatives, Sheila Garcia and Adán Soltren, joined forces with public member Christian González-Rivera and landlord representative Robert Ehlrich in opposing the increase – Ehlrich wanted a bigger hike. Reiss, three other public members, including Mayor Eric Adams’ appointed Arpit Gupta and landlord representative Christina Smyth, approved the new tariffs.
The increase falls roughly in the middle of the proposed range of 2 to 4 percent, which the board had voted to consider last month. Approximately 2.4 million people live in New York City’s rent-stabilized units, and the increase applies to leases signed between October 1, 2022 and September 30, 2023. Last year, the board voted to adopt a mid-year increase of 1.5 percent pr. one-year leases and 2.5 percent on two-year leases.
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Although apparently independent, each board member is a mayoral nominee and typically approves a proposal favored by the current mayor. Soltrén, the tenant representative, told the audience that “the impartial and independent body had already decided many of your fates”, even before he was appointed.
Adams had called for a rent increase to protect small landlords, which represent a dwindling share of the city’s housing market.
With New York City immersed in nationwide inflation and unemployment well above the national average, Adams said the rent increase will be a “disappointing” burden for tenants.
“At the same time,” he added, “small landlords are at risk of going bankrupt due to years with no increases at all, endangering building owners with modest funds while threatening the quality of life of tenants who deserve to live a good life. maintained, modern buildings. ”
The vote comes after months of public hearings, with property owners stating their needs, while tenants described the crumbling conditions for their apartments as well as their struggles to keep up with monthly payments.
RGB members weigh landlord costs, including property tax rates, water supply rates, maintenance and insurance, as well as major financial trends when making their decision. A report prepared by RGB staff based on 2020 data and released in April shows that landlords managed to earn revenue from “almost all buildings” with stabilized units, but their net operating income fell by 7.8 percent, the biggest drop since 2003.
At a public hearing on June 8, property owner Helen Greenberg testified that her building dates back to 1869 and requires “constant care, repairs and upgrades” along with administrative fees for inspections. She said she needs the rent increase to keep up.
At the same hearing, Sunset Park tenant Nora Huertero, a mother of three, said her building’s boiler broke for four days in the winter and that her landlord has failed to cash rental checks. If the rent goes up, she said, “I’m going to have to work more hours, and that means I want to spend less time with my kids.”
“The rent is already high and they are trying to chase us to raise the rent,” she added. “We are just getting over the pandemic and inflation.”
The 1,006,000 rent-stabilized units across the five boroughs account for 28 percent of the city’s total housing stock and 44 percent of all rental units, according to the latest housing and unemployment survey published last month by the Department of Housing Preservation and Development. Tenants in stabilized units receive relatively modest increases compared to non-regulated apartments, where the median rent reaches a record high since a COVID-related price drop. They also receive protection against eviction for no reason, even after their lease expires.
More than half of rent-stabilized tenants pay over 30 percent of their income in rent, according to board data. The median rent was $ 1,400 in rent-stabilized units last year, and about 20 percent of the units had three or more maintenance deficiencies, the city’s latest housing and unemployment survey found.
Rent-stabilized tenants, their lawyers and several other elected officials criticized the decision, saying it was not fair to compare the experience of landlords who own property that they can sell in New York City’s overheated housing market if they can not afford their mortgages or anything else. . costs, with tenants facing eviction and insecurity if they are unable to pay.
“By raising rents, which is far higher than a realistic cost estimate, the board is capitulating to property owners – with dire consequences for the roughly 2.4 million rent-regulated tenants who will be hard-pressed to afford their homes,” he said. said Inspector Brad Lander.
Lander had previously questioned the board staff’s assessment of tenant and landlord costs. He said the analysis did not take into account the true extent of the economic crisis for colored low- and middle-income people, which accounts for the vast majority of stabilized tenants.
City Council Housing Chairman Pierina Sanchez called the vote “a disgraceful result.”
“Tonight’s vote will add to the crushing weight that destabilizes our society,” Sanchez said.
Jay Martin, leader of the rent-stabilized landlord group Community Housing Improvement Program, countered that the increase did not go far enough and said more money is needed to keep pace with building repairs.
“If the RGB continues to repay rent-stabilized buildings year over year, then the consequences will be severe for tenants and their housing providers,” Martin said. “It is expensive to operate rent-stabilized buildings that are more than 80 years old. If the rent does not have to pay for it, the government needs to find other ways to reduce costs. “
Advocates and members on all sides of the issue called for adjustments to the annual battle between landlords and tenants. González-Rivera, one of the five public members, said the state and city government should provide “more generous” tax cuts to property owners who make repairs instead of raising rents.
“One part of the government sends the owners a tax bill, while the other, the RGB, sends that tax bill to tenants,” González-Rivers said. “We have to blow this system up.”
Goddard Riverside’s organizing director, Larry Wood, said tenants end up being penalized through a “one-size-fits-all rent increase,” even if their landlord makes a profit.
“There has to be a way to distinguish between owners who are having real difficulties and the majority who are doing quite well,” he said. “It’s inconceivable that there would be a rent increase.”
* Correction: An earlier version of this article incorrectly attributed a quote to board member Arpit Gupta in place of Christian González-Rivera.