The Real Deal New York

Vote could lead to “unprecedented” rent freeze

Board gives preliminary OK to plan barring hike for some non-market-rate tenants
May 06, 2014 08:30AM

The city’s Rent Guidelines Board took a preliminary vote on Monday in favor of a potential rent freeze for rent-stabilized tenants with one-year leases. If approved next month in a final vote, it would be a first for the city.

Under the plan, tenants with one-year leases could see a rent hike between 0 and 3 percent, meaning there might be no increase at all. Rent increases for two-year leases would be in range of 0.5 percent and 4.5 percent. The board approved the proposal by 8-to-1 on a preliminary basis, though some landlords are unhappy with the initial outcome. Percentages would be set at the time of the final approval.

“It is outrageous. It is unprecedented,” Jack Freund of the Rent Stabilization Association told the New York Daily News.

Mayor Bill de Blasio, who supports a one-year freeze for rent-stabilized tenants, appointed six members of the nine-member board to date. [NYDN]Mark Maurer

  • TefExpat

    The Landlord is now known by his tenants as BABY DADDY

  • SocialismAlwaysFails

    Private property rights mean nothing anymore. The one thing that transformed our country into what used to be the wealthiest nation in the world – has now been replaced by government dictates. It’s fascism. “Private” ownership with government control. Besides the fact that it’s horrible, horrible economics (price fixing always distorts the market – negatively) it never achieves it’s “good” intentions. It’s a liberal vote grab and makes some feel warm and fuzzy. We have replaced the word “entitlement” with the word “right”. These aren’t tenant “rights”. They are entitlements plain and simple. They are subsidies. Free market tenants subsidizing those who are fortunate enough to be in controlled units.

  • TheYoungGetScrewed

    “Free market tenants subsidizing those who are fortunate enough to be in controlled units.” 100% right. Maybe the 22 year old college grad wouldn’t be paying $2500 for a 350 sq ft unit if 50% of the units in the building are paying $600.

    • noclist

      The 22 yo college grad can move to the boroughs were rent is 2/5 the price for the same size studio.

      • TheYoungGetScrewed

        Why can’t the rent stabilized move to Yonkers or wherever where the market rents are similar to their Manhattan Stabilized rents?

        Why doesn’t Sheldon Silver and all his family/cronies move out of rent stabilized housing so that people who need it can get it?

        Why does rent stabilization have a cut off of $250,000 in annual income? With Mr. Silver proposing to raise it to 400K just a couple of years ago? If you make $250,000 should your rent be subsidized?

        • noclist

          “Why can’t the rent stabilized move to Yonkers or wherever where the market rents are similar to their Manhattan Stabilized rents?”

          Market Rate Rents in Yonkers are nearly identical to those in the North West Bronx. 1 bdrms $1800, 2 Bdrms $2200.
          The RS rents in this area are only a couple of hundred less than market.
          Try coming close to these rents in Manhattan. You can’t.
          The problem is not rent stabilization, per se; the problem is rent stabilized apartments in Manhattan.

          • TheYoungGetScrewed

            Great discussion Noclist.You are right on several points:

            Market rate rents in South Yonkers are significantly lower than you state…Studios start at $850 1brs at $1000 2brs at $1200. This from what I have seen is similar to what most stabilized tenants that moved into Manhattan apts in the 80’s currently pay.

            You stated that the 22 year old should move to the boroughs and I was just asking why they should be the ones to move and not the rent stabilized tenants. Overall market rents would fall (in theory) if an entire building was free market since there would be no lower rent tenants to subsidize.

            As for rent stabilization, the problem is the program in Manhattan. Most Rent stabilized apts that are vacated end up being deregulated through vacancy increases, renovation increase etc. Therefore, politicians try to keep the current tenants in the RS apartments as long as possible by increasing maximum salary levels etc. They don’t want to be the ones to lower the maximum salary levels only to see tenants kicked out and the unit’s deregulated. However, they never look at ideas where
            they lower the maximum salary levels but minimize vacancy increases in those specific cases. This would keep the units regulated but open them up to lower income tenants like the young kids coming into the city. I know this is not an issue in the boroughs but it is a bigger issue than many think in Manhattan and is growing in Brooklyn.

          • noclist

            South Yonkers is kind of a crappy neighborhood these days. I was thinking more to the east near Bronxville. (Yonkers, in case you don’t know, is rather segregated, even today). I agree that most of the hub-bub over RS has to with the difference in market rate vs RS rents, but I’m not totally convinced that eliminating RS would bring market rate rents down when coops and condos are going for millions in Manhattan. In the outer boroughs, the rent spread is much less and the building I live in has many vacant apts that are decontrolled as they passed the rent threshold with tenant turnover. Regardless, I estimate my landlord generates around $7 mil in revenue per year, with the mix of market rate and rent stabilized apts. If he wasn’t making money, we would have been coop’d a long time ago.

  • Willard?

    How the heck is Sara Williams Willard representing landlords?????

  • We need more housing

    I hate politics and so I don’t donate to politicians but when the City’s numbers show that my expenses went up 5.7% and then they only give me rent increases in this proposed range I’m left with no choice. It seems I’m forced to go bankrupt or buy off politicians in the State Senate.
    DeBlasio you’ve put me in a no win situation. Shame on you. My guess its that Republicans in the State Senate will see campaign contributions like never before. If DeBlasio won’t be reasonable then landlords are left with no choice.

  • noclist

    If history is any indication, the increases usually fall smack in the middle of these ranges, meaning 1.5% for 1 year and 2.25% for 2 year. Of course with an 8-1 vote, we’re in the twilight zone, so anything is possible.

  • no-permits

    deblasio is a bum

  • David Brown

    Yes, I’m sure this will help the Mayor build 100-200K low income/middle income housing units during his term!

  • Rosemary

    Why should rents increase when tenants pay is not increasing? Thank god for rent stabilization or the only people who could afford to live in Manhattan would be the rich.

  • Denny

    Sure, freeze the rent. Whatever…just make sure to freeze the tax increase, the electricity, gas, insurance, water & sewer and we will all be happy. As long as more money is shelled out for the same services, there is no logical reason why the rents shouldn’t increase.
    Don’t forget…a lot of these RS tenants were able to secure DeBlasio his win.