The Real Deal New York

City-managed rent regulation: disastrous for housing stock?

Former state housing commissioner warns against rent-hike rollbacks, freezes
May 09, 2014 05:45PM

According to Charles Urstadt, for whom a 1971 law granting Albany authority over New York City rent regulation is named, rolling back the legislation would make the Big Apple “look like Havana.”

Urstadt told Crain’s that such a measure, which Mayor Bill de Blasio has proposed, would prove disastrous for the city’s housing stock. The former state housing official argued that handing over rent control to a progressive, tenant-friendly council would result in rent hike rollbacks or freezes while costs continue to rise for building owners.

“The costs of operating the apartments will continue to rise, since water prices are going up astronomically, along with increases in real estate taxes, labor costs and insurance costs,” Urstadt told Crain’s. Urstadt, who served as the state’s housing commissioner under the Nelson Rockefeller administration, is now chairman at a Connecticut real estate firm.

“Look at the city’s record as a landlord with the (New York City Housing Authority),” he added. “It’s not very good.” [Crain’s]Julie Strickland

  • TefExpat

    It will also create a class of BABY DADDIES, currently known as LANDLORDS

  • Oouch

    Who is kidding whom? Land costs have skyrocketed in Manhattan. That is a cost that is generated from underutilized or undeveloped parcels held for decades and/or trade by speculators who finagle how to sell for minimum tax impact. Water cost are ‘going up astronomically’ . . . from near zero every increase is sharp. But, nothing like the rent increase that have occurred in unregulated apartments. Real estate taxes in NYC continue to be about half of Westchester or Nassau Counties. Labor costs in RSA tax payers with a parttime super weren’t streaking off the charts last we checked. Insurance is always light on multiple dwellings. So the following statement by Urstadt is bunk compared to land cost and speculation:

    “The costs of operating the apartments will continue to rise, since
    water prices are going up astronomically, along with increases in real
    estate taxes, labor costs and insurance costs,” Urstadt told Crain’s.

    There are vast swathes of prime areas like the West Village, Nolita, and Soho, along with the LES that have been held off the market by the owners who put as little as possible into their holding while the land appreciates and they refi to live like kings. Meanwhile, the artificial scarcity they helped create drives the prices up. This goes for staid institutions like the Seminary, which sits on loads of Fidi still, and various infamous families like the Rings or Dezer who are heavy in “B” taxpayers that are way underutilized. And families like the Dursts who had the sleaziest of Times Sq. holding were allowed to make windfall profits ultimately. Who benefited? Not the tenants or renters of NY for sure. So DeBlasio’s original proposal to change tax structures that favor undeveloped lots or under-rented B’s where next door there’s zero vacancy has some merit, but, likely, zero chance of succeeding. Too subtle for tenants to grasp and not simple enough for council people to figure out how to personally profit from. But current policies perpetuate buy, hold, and flip without investment as a profitable strategy.

    • Ronald Edelstein

      Unfortunanatly your incorrect. de Blasios’s “inclusionary housing plan” has effectively killed all new projects going forward. No developer will build anything under these new mandates. The poor will suffer along with the weathy. The days of speculation are gone with this new plan. Please understand that someone has to “Own” properties and if they dont make money they won’t build or own. Urstadt is correct. Your wrong.

      • “We lived in the Almont”

        We need to live amongst the people of your own social and economic class not share a building with people who have to be mindful that you may be made uncomfortable and assessing their wardrobe’s cost in the shared elevator.

        • TefExpat

          Its not the dress, sagging pants notwithstanding. Its the noise and the occasional pissing in said elevator.

          • they know what they are doing

            Oh, please. Just because you “qualify” for affordable housing does not mean you actually have a problem covering your smartphone bill. It’s not like you are out of pocket as much as the average New Yorker, if you are one of the lottery winners of affordable housing. You can shop at Whole Foods and still be getting government cheese. If they are misbehaving especially with noise or litter in the building, they are doing it to be hostile because they can get away with it because they are special protected class.

            Someone who knows the situation in our building with designed garbage placement said that other regulated buildings have someone like that too especially when there are newer tenants in the building. HIs anecdotes echoed ours which is why I think SPONYs should get together and write a book or a blog. There is no way this can be a coincidence.

      • Oouch

        @Ronald Edelstein – Unfortunately some people can’t spell unfortunatly (s.i.c.), and you’re incorrect in grammar contraction as well as the assumption that I’m advocating a plan so much as a change in taxation patterns. 421A lollipops for developers sure did solve the housing shortage didn’t they? LOL. As for the rest of the racist nitwit posts below all they do is reinforce the mistaken belief that the NY Real Estate industry is riddled with racists.

        At the turn of the 20th Century what caused NY’s boom into Metropolis was the building of the subways, much of this with subsidy from the developers who profited many times over.


    Why not reference his other Crain’s article? There is plenty of room in Battery Park City for the one million rent regulated tenants and they would be in chic Downtown so they can’t complain that they are losing location, they are gaining not a son in law but views of the Statue of Liberty. Owners could trade whatever was needed to have safe housing stock for the regulated few in exchange for development of their buildings/neighborhoods so that another East Harlem building collapse does not become an issue.