4 ms·

This. I agree that the original rent control program was badly structured, but today, true rent-controlled apartments only account for 1.8% of all rental units

This. I agree that the original rent control program was badly structured, but today, true rent-controlled apartments only account for 1.8% of all rental units in NYC (http://furmancenter.org/files/publications/HVS_Rent_Stabilization_fact_sheet_FINAL.pdf http://furmancenter.org/files/publications/HVS_Rent_Stabiliz...). And as the parent says, this number can only fall. Rent-stabilization, on the other hand, is being expanded (the 2011 Rent Act increased the minimum rent for deregulation to $2500/month). It's less drastic than rent control and seems to at least have some effect on keeping rents low(er, this is NYC) without being open to such gaming effects as rent control. However, there are always loopholes. When I moved into my Manhattan apartment, I was told before lease-signing that the rent would be less than the $2000/month ceiling (at the time) for rent control. However, upon lease signing, the rent on the lease was $2050 and there was an attached rider saying I would be paying a lower, "preferential" rent - the originally agreed upon amount - presumably to avoid rent-stabilization. Who knows if that would stand up in court, but as long as management companies can make the tenants believe it's not rent-stabilized, it doesn't really matter...

glenra 14y ago
The idea that stabilization is "having some effect on keeping rents low(er)" seems questionable. There are effects that push in the other direction too. For instance, the fact that "stabilization" exists at all makes being a landlord less attractive. If people could bargain freely to any mutually-agreeable rent terms, developing new housing would be less risky so more apartments would tend to get developed, which would drive down the average rent. Stabilization can hold down prices in a few apartments, but tends to do so at the expense of higher prices (and lower-quality apartments) everywhere else.
- epc 14y ago
  There's plenty of new development going on, both condo and rental apartments. New rentals are typically required to set aside some percentage of units for specific income levels (so-called affordable housing). Condos typically trade in 421-A tax credits (where new developments get very reduced property taxes for some period of time, in return the developer must build some number of "affordable housing" units, but not necessarily in the same building or even neighborhood). Stabilization and Control have definitely warped the market, but to date no one, on either side of the tenant/landlord divide, nor in politics has come up with a workable way to deregulate the market. It was thought that eventually the Stabilization would go away because, as we all know, no one wants to live in New York City and eventually the vacancy rate would go to 5% or more. In practice the highest it's been since 1974 is in the low 4% range in the 1980s and very early 1990s.
  - chimeracoder 14y ago
    > New rentals are typically required to set aside some percentage of units for specific income levels (so-called affordable housing). This happens, but it's different from rent stabilization - the program's separate and the rules function differently.

glenra 14y ago

The idea that stabilization is "having some effect on keeping rents low(er)" seems questionable. There are effects that push in the other direction too. For instance, the fact that "stabilization" exists at all makes being a landlord less attractive. If people could bargain freely to any mutually-agreeable rent terms, developing new housing would be less risky so more apartments would tend to get developed, which would drive down the average rent. Stabilization can hold down prices in a few apartments, but tends to do so at the expense of higher prices (and lower-quality apartments) everywhere else.

epc 14y ago
There's plenty of new development going on, both condo and rental apartments. New rentals are typically required to set aside some percentage of units for specific income levels (so-called affordable housing). Condos typically trade in 421-A tax credits (where new developments get very reduced property taxes for some period of time, in return the developer must build some number of "affordable housing" units, but not necessarily in the same building or even neighborhood). Stabilization and Control have definitely warped the market, but to date no one, on either side of the tenant/landlord divide, nor in politics has come up with a workable way to deregulate the market. It was thought that eventually the Stabilization would go away because, as we all know, no one wants to live in New York City and eventually the vacancy rate would go to 5% or more. In practice the highest it's been since 1974 is in the low 4% range in the 1980s and very early 1990s.
- chimeracoder 14y ago
  > New rentals are typically required to set aside some percentage of units for specific income levels (so-called affordable housing). This happens, but it's different from rent stabilization - the program's separate and the rules function differently.