In New York, the Panel supports rent increases of more than 2 million

The New York City panel responsible for regulating rents in nearly one million rent-stabilized units voted on Thursday to back the biggest increases in nearly a decade.

The move, which must be officially approved next month, would increase rents for one-year leases by 2-4% and those for two-year leases by 4-6%. The increases are another reminder of the affordability crisis the city is facing as it emerges from the pandemic.

The panel, known as the Rent Guidelines Board, kept increases low during the tenure of former mayor Bill de Blasio, a progressive who ran on a promise to reduce inequality. In four of the past eight years, the council, which is effectively controlled by the mayor, has voted to freeze rents.

But even during his campaign, Mayor Eric Adams, who is more moderate in many of his positions, had expressed skepticism about the rent freeze and sympathy for family landlords. Members of the real estate industry have been among the mayor’s biggest donors, and Thursday’s vote echoed his friendlier stance toward city business leaders and small landlords.

Mr Adams said some of the increases initially announced – up to 4.5% for one-year leases and up to 9% for two-year leases – were too high and he called for a “better balance”.

“It’s good that the council has gone down,” he said in a statement after the vote. “But if rents and other living costs are going to rise with inflation and other economic issues, so will government support, which is why I’m fighting for a housing voucher program. more generous, a more robust income tax credit and significant investments in child care.

For at least 20 years, the outcome of the preliminary vote has closely matched the final numbers, which have often tracked inflation trends. Inflation was generally lower during Mr. de Blasio’s tenure than today. The last time there was a significant increase – 4% on one-year leases and 7.75% on two-year leases – was in 2013.

The current proposals were passed by a five-to-four vote at Thursday’s virtual meeting, and amounted to common ground: less than the increases proposed by owners’ representatives on the board at the meeting, and more than those favored by tenant representatives. .

But the proposed figures are likely to spark protests and intensify lobbying efforts from landlord groups, who are pushing for higher rent increases, and tenant advocates, who feared any increases would derail capacity. low-income New Yorkers regain their economic footing during the pandemic.

Most of the more than two million New Yorkers who live in rent-stabilized housing, more than the populations of Dallas or Philadelphia, earn far less than the citywide median household income of about 67 000 dollars. Tens of thousands of New Yorkers have fallen behind on their rent during the pandemic and many still owe thousands of dollars.

Meanwhile, evictions, although still well below pre-pandemic levels, have increased in recent weeks. After a pandemic drop, rent levels in homes not regulated by the city have risen sharply.

But owners and their advocates say they need the increases to cope with rising inflation and rising spending on fuel, labor and building maintenance. Landlords said New York’s tenant protection laws passed in 2019, which restricted their ability to raise rents when an apartment became vacant or upgraded, also made it difficult to cover their costs.

Joseph Strasburg, president of the Rent Stabilization Association, an industry group, said the board’s proposed ranges would not offset a slight increase in spending.

He said the council “must now consider the higher end of the preliminary ranges so that homeowners can deal with general increases in inflation, property taxes, water bills, fuel oil and electricity.” other operating costs”.

Robert Ehrlich, an owner representative on the board, voted against the proposal passed by the board.

“Housing has costs,” he told the meeting. “We need to make sure the buildings have the money to pay for these costs. If we don’t do things right, many could fall into disrepair. »

But tenant advocates expressed outrage. Sheila Garcia, a tenant representative on the board, participated remotely from the Bronx with a group of tenants holding signs calling for rent cuts. She said many of the tenants with her were “suggesting that when they get evicted maybe they could come and live with some of the board members who support these increases.”

“The minimum 2% would be devastating to the people in this room,” she said.

Denisa Rodrigo, who lives in a rent-stabilized studio apartment in Sunnyside, Queens, said any increase would be “unsustainable”. Ms Rodrigo, 56, lost her job as a medical assistant when the private doctor she worked for closed her practice in 2020, at the height of the pandemic. She said she is always looking for a new job.

Ms. Rodrigo’s monthly rent is $1,050, which she has mostly been unable to pay since April 2020. A pandemic rent relief program covered about $9,000 she owed, but she still has about $10,000 to repay, she said, and any further increases authorized by the board could leave her even more in debt.

“I paid what I could, out of my savings, and I used up almost everything I had,” she said.

The rent stabilization system, established in 1969, has become a large and important source of affordable housing in one of the most expensive places to live in the country. The median monthly rent is around $1,269, compared to $1,700 in unregulated homes.

The more than one million rent-stabilized apartments represent about half of the city’s rental housing stock.

Just over 40% of those renters are Hispanic or Latino and more than 20% are black, according to city estimates, while the median household income of rent-stabilized renters is about $44,000, or more. 33% less than the figure for unregulated apartments.

The nine council members, all of whom are appointed by the mayor, include five public representatives, as well as two for landlords and two for tenants. Annual council votes are one of the few ways the mayor can directly address the city’s housing costs, and Adams has appointed three people since taking office. The other members were appointed by Mr. de Blasio.

The annual votes, usually held in raucous meetings, have long sparked a heated debate between landlords seeking higher increases and tenants seeking to lower their monthly bills.

The group of tenants with Ms Garcia occasionally chanted, “We are already overcharged with rent” and applauded proposals to reduce rents. But because it was held virtually, the hour-long meeting was relatively subdued.

Matt Murphy, executive director of New York University’s Furman Center for Real Estate and Urban Policy, said the board needed to balance affordability concerns with the need to prevent properties from collapsing. degrade.

“It’s a lot of pressure on them to find the right number in a way that probably hasn’t existed in the last 10 years,” he said.

The owners were hoping for a new approach from the board.

Landlords have “really suffered” during the rent freeze period, said Christopher Athineos, who and his family own seven buildings totaling 125 apartments. About half of the apartments, mostly in Brooklyn’s Bay Ridge and Park Slope, are rent-stabilized.

Mr Athineos, who has been attending these board meetings for decades, said some of his buildings are almost 100 years old and need constant maintenance.

A building in Bay Ridge requires routine facade repairs, he said, with a recent repair costing about $19,000, up from $15,000 four years ago, when labor and materials were cheaper.

At another nearby building, Mr. Athineos said his annual fuel costs had risen from around $26,000 in 2020 to nearly $40,000 in 2021. He said that with no increase in rent he is allowed to collect, it will likely continue to make fixes, such as caulking. a roof instead of replacing it.

“At the end of the day, if they want to look more at tenant affordability, then the government should step in and compensate us for our costs,” he said.

Emma G. Fitzsimmons contributed reporting.

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