State and city politicians keep offering “cures” for the ailing housing market that only make things worse.
If lawmakers insist on flouting the laws of economics, New York’s housing stock will crumble more, and both landlords and tenants will suffer even more.
Take the city’s 57,000 zombie apartments — units that remain vacant because state law prevents owners from charging enough rent to cover the costs of bringing them up to code.
This week, City Councilmember Farah Louis introduced legislation requiring the Department of Housing Preservation and Development to draft a plan to make these units available.
The fix, of course, is obvious: Let landlords pass more (if not all) of the repair costs to tenants, via higher rents.
Yet pigs will fly before prog lawmakers suggest that.
Expect HPD to instead call for new subsidies — courtesy of the taxpayers.
Yet city, state and federal budgets have no extra cash for such hand-outs, and government funding rarely goes where it’s needed most in any case.
HPD might also propose penalties for keeping apartments vacant — i.e., more disincentives to invest in rent-regulated units.
Or take Mamdani’s efforts to turn buildings into New York City Housing Authority-style projects: His staff failed to steer a 38-building mostly rent-regulated portfolio to tenant-approved owners; the lenders who controlled the properties opted instead for a foreclosure sale.
At Tuesday’s auction, 14 of 15 buildings received no outside bidders, and the one that did sold for just $826,000 — less than half the $1.9 million loan amount.
Duh: If government action (Mayor Zohran Mamdani’s rent freeze, for one) forces owners to lose money on their buildings, who’d want to buy them?
That’s why the Community Opportunity to Purchase Act Mamdani just signed into law — forcing owners of distressed buildings to sell to “qualified nonprofits” — will also flop.
After all, even nonprofits must deal with economic reality: Unless they can fund a permanent annual loss on rent-capped buildings, they can’t afford operations either.
More proof of socialist-housing insanity: In September, Hizzoner boasted of having paved the way (with HPD agreeing to use taxpayer money for repairs) for the sale of three Crown Heights buildings (facing more than 1,000 violations) to a savior landlord.
Some savior: According to The City Reporter, the buyer has made “frequent appearances on the city’s worst landlord list”; he and his partners “have racked up more than 1,400 open housing code violations” in buildings they own or manage.
Tenants must be thrilled.
Fact is, New York’s leaders refuse to address the key problem: Simple-minded “pro-tenant” moves discourage investment and shrink the housing stock — when growing it is the only way to truly bring down rent.
At the same time, below-market rents spark excess demand.
It gets ever harder to find a decent, affordable apartment in New York because the politicians’ “cures” are pure poison.
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