Affordable Housing Preservation Preserving New York’s aging housing stock through targeted investment to improve housing conditions and affordability for New Yorkers has long been crucial. It is also a powerful force against displacement of low-income renters. In recent decades, market pressures in the city have escalated rents, incentivized the conversion of rent-regulated housing to market rate, and threatened the supply of naturally occurring affordable housing. In addition, the age of the City’s residential building stock indicates that the need for recurring repair and renovation will only continue to burden multifamily buildings. New York City is currently undergoing enormous turmoil in its real estate markets as a result of the COVID-19 crisis- one that we have yet to fully understand.
FROM THE GROUND UP | 2021
The COVID-19 Recession will cause a “waterfall of effects” that will continue to bear down on renters and property owners going into the next mayoral administration. Lost tenant income will eventually place financial stress on landlords,65 while higher rates of building distress and foreclosure could potentially displace New York’s most vulnerable tenants. The next mayor’s affordable housing preservation strategy should use creative solutions to avert the cascading financial risks that COVID-19 poses for tenants and owners. However, the impacts of COVID-19 might create some opportunities to boost affordable housing for New Yorkers temporarily or permanently.
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It is important to monitor residential and commercial mortgage default rates and to anticipate a new wave of distressed assets. Unimaginably, NYC’s vacancy rate may also be changing at an unexpected speed, which could lead to a decline in rents, property values and most critically impacting the emergency vacancy rate threshold that helps to justify the need for rent stabilization market controls.
NYC’s next mayor must be ready to respond to these changes to both mitigate market damage and to also take advantage of opportunities to preserve affordable housing.
