The Rent is Too Damn High Party

krowonhill, great post. I will have to read it over again to really dig into it, but my only immediate comments are:

- Neighborhoods like Tribeca, Soho, the LES etc haven't lost their appeal despite being drained of much of their "street cred" over a decade ago
- Despite the difficulties of being poor + middle class in NYC, many people still stay because of the abundance of opportunity. A plumber in NYC might never be rich, but they will always have a job, which trumps a lot right now. A lot of people aren't happy these days.

Regarding the solutions:

I don't think MHA or krowonhill suggested that the rich should pay for the poor and middle class housing solution.

But I think whynot's (and my) assumption was that a program or programs implemented to directly address the inequities of NYC housing distribution would have to cost big bucks. After all, prior efforts were essentially huge public works projects or private projects with such heavy subsidies that they were essentially wholly subsidized. With the spectre of the economy & government bankruptcies, even if space for such developments hadn't been usurped by for profit developers I don't think such a wholesale program would be in the city's best interest.

Even if such developments were possible in areas close enough to or within the city, and they were done by non profits, the cost of construction in NYC would still require heavy grants & all to make the projects actually happen. There are just very basic + practical setbacks that vaporize the possibility of new lower/middle class developments in NYC, even outside of the cost of land (which can be nullified by eminent domain) and the pushback of anyone who would be displaced.

So new developments are out. What's next? Rental vacancies in the city are impossibly low at about 1-5%, depending on the borough & neighborhood. So it's not like there are some huge empty developments waiting to be occupied. Though in my travels I have seen some potential places:

- Spanish Harlem, surprisingly, has a lot of empty storefronts and abandoned buildings. Property is probably still pretty expensive, but the city could take over abandoned properties through eminent domain and develop them that way.
- Coney Island has quite a few public housing towers that are surprisingly empty.

I do question the accuracy of the vacancy percentages I've heard, so figures may be higher and reallocation of vacant units is an idea. So aside from the tenants buying properties from their landlords, that's another idea that pretty much wouldn't cost anything.

Beyond that though, I draw blanks, as I can't come up with solutions to reverse the situation that would be fair or constitutional to all involved (which sucks as the whole situation was in a way created by putting the rights & concerns of some over others). I mean I'm sure those displaced by gentrification would propose to boot those who displaced them, but that's obviously unfair + unconstitutional + a lot of "uns" that would just not work. Two wrongs don't make a right. Subsidizing rents is out as discussed before. Forcing landlords to drastically reduce rents below profitability (on top of rent control) seems unfair as well, and could trigger widespread real estate liquidations and a depression of the NY property market- which at face value might seem like a good thing, but in reality could do the city harm by scaring away investors and further lowering much needed property tax revenues.

So idealistically I agree largely with krowonhill after hearing her side more clearly. Pockets like the LES & Williamsburg & the East Village, and to lesser degrees Crown Heights, Bushwick, Harlem, etc. have seen massive demographic shifts and a generally rapid decrease in rental affordability. The effects of said shifts have been, unfortunately, the displacement and in many cases departure from the city of the city's poor & middle class, which also contains some of the city's most valuable assets- its creative guild (as well as the interesting people who managed to survive through NYC's worst periods).

But looking at case by case pieces & the whole picture logistically, I see a few things. One, a lot of the gentrification in the city is not due to unfair Bloomberg developer bias. In places like downtown Manhattan, many of the buildings are original & therefore (unless Bloomberg also pushed for gut renovations, which I wholly agree could be possible) aren't the result of developers, but merely the city becoming safer and the market responding to newly livable & convenient housing. That's definitely the case for places like Bed Stuy and CH. So the dismissals of the effects of the free market are bunk; the free market played a huge part in the changes of the city (though again the argument could be made that new developments created shifts that would not have happened otherwise... a point I'd be willing to explore further)

Two, as much as people hate landlords, ultimately I'm pretty sure most of them are just regular folks who own properties. Of course many have become rich from the NYC real estate boom, but I don't think that's anything to fault them for. So I think the wholesale demonizing and dismissal of the concerns of landlords (and property owning groups) is wrong as well. That complicates things further as their interests go completely against the interests of tenants, but are no less important.

So all in all I think in many cases, the rent indeed is too damn high. But the whole situation has to really be thoroughly analyzed, and in creating solutions, all possible considerations must be made for all involved parties (the future of the city culturally, logistically, and financially; the poor, the middle class, the rich; landlords, developers, and investors). With those considerations in mind I think it becomes clear that actually making judgments on what's fair/unfair & creating solutions for the problems at hand is not at all simple, and shouldn't be dismissed as such. On my part at least, throwing out solutions isn't from a reluctance of wanting to help- it's a matter of helping in a way that is fair and makes sense.

Cool The Kid wrote: [quote=MHA]I think that middle income housing and lower income housing ought to be owned by middle income people and lower income people. I think that if you live in Section 8 housing, then you ought to own Section 8 housing, and if you don't want to buy it, then move out. I think that if Section 8 housing was privatized then those who live their would be impelled by the power of equity to take better care of where they live. If people are acculturated to not have a sense of propriety about their homes, I believe that many social ills follow. In the same sense that those who benefit from Habitat For Humanity homes are curtailed from selling their property in a given time constraint, if private ownership were to be a function of Section 8 housing then those who have live in Section 8 housing would be forced to change a great deal about how they live their lives.

MHA, how do you propose that idea be implemented? For a section 8 building, for which at least 70% of the rent is subsidized, how would the tenants suddenly collectively take over a mortgage of the building with no down payment at market rates and property values? Should the gov't force the landlord to essentially give them the property? Should the gov't subsidize the transfer of property so that the property costs what the tenants can afford? How would an almost bankrupt city/state/federal gov't pay for such a program?

I agree that ownership would help tremendously. But handing over the deed of a building won't instantly transform people who probably have grown to feel entitled to the subsidy of their whole existences into self-sustaining responsible members of society.

The lower + middle class people would probably respond in the manner you think would happen, but again the reality is there would have to be significant gov't intervention that I don't know the city could afford at a scale that would be large enough to truly make a change.

CTK, I agree with your 9:45 post so much that I won't spend time responding to it. Our differences would be like splitting hairs.

Together with MHA, we also seem to agree on the disadvantages of having people occupy units (via programs like Section 8 ) that they do not own.

However, the goals each of you are stating exceed that of "mere housing" (for example, everyone seems to want them to maintain their housing, take pride in their housing, and develop a sense of community) ....which is basically a greater goal than merely housing folks. Don't get me wrong, I'm for those goals too, but I just wish to point out that we are articulating goals for our Carnivore-CTK-homeowner-MHA-Booklaw-Krow-Whynot-whoeverelse Housing program that go way beyond affordable housing.

In an attempt to house the middle class, and perhaps because it did not want to attempt to address the entrenched habits of low income renters, NYC created Mitchell Lama housing.

At the time, it took the form of:
new construction
high rises

and required a work history, significant deposit and background check.

I argue that this approach was radically different that programs for the poor, such as Section 8 and NYCHA.

I believe the programs provided (and provide) huge benefits to their target population.

....but they were (and are) full and expensive.

...but clearly there is a demand for more of them.

Interested?

If so, I present you with reading material.

Executive Summary:
Mitchell Lama apartments apartments come in two types, rental and owner occupied coops:

http://www.nyc.gov/html/hpd/html/buyers/mitchell-lama.shtml

http://www.nyc.gov/html/hpd/html/apartment/mitchell-lama.shtml

So far, this discussion seems to be focused on the COOPs because they offer ownership. ...but I believe their may be some interest in the RENTAL aspects of this program as well, because it has been implemented in a way that (I believe) continues to maintain safe, affordable, clean, housing for the low middle class and middle class.

Prerequisite reading:
This link, PLUS the PDF files that appear in its cites.
http://en.wikipedia.org/wiki/Mitchell-Lama_Housing_Program

....We can get carpal tunnel typing about it here, or get together and have a more efficient conversation. ....one complete with intonation.

It might prevent the humorous assumptions made in this thread.

Of course, such a conversation would continue to be futile if we assume that people who own a home and/or believe in private ownership should not be involved in the solution.

...oh, and I think it goes without saying that our housing will be available to all who qualify, as enforced by NYC CHR
http://www.nyc.gov/html/cchr/home.html

Anyone?

Cool The Kid wrote:
So all in all I think in many cases, the rent indeed is too damn high. But the whole situation has to really be thoroughly analyzed, and in creating solutions, all possible considerations must be made for all involved parties (the future of the city culturally, logistically, and financially; the poor, the middle class, the rich; landlords, developers, and investors). With those considerations in mind I think it becomes clear that actually making judgments on what's fair/unfair & creating solutions for the problems at hand is not at all simple, and shouldn't be dismissed as such. On my part at least, throwing out solutions isn't from a reluctance of wanting to help- it's a matter of helping in a way that is fair and makes sense.

CTK, I think this is well said, particularly your point about none of this being simple. And I'm glad that I was able to convey my own point of view in a reasonable way.

To one of your many thoughtful points above, I don't believe implementing programs to address the lack of affordable housing in NYC for the middle-class and working poor would necessarily have to cost big bucks. I do think that such programs may need to be creative. In the past and in other cities, administrators who have wanted to make such programs work have developed creative solutions to the issue, but I do agree that solutions here in NYC in 2010 may not be obvious or easy. As an example of a proposed creative solution, the group Right to the City advocates taking over failed luxury condos whose owners owe back taxes in the millions of dollars for use as affordable housing:

http://www.prospect.org/cs/articles?article=gentrification_hangover

Now, I'm not knowledgeable enough about all the stakeholders to know if this really is a viable option, but it definitely seems worth considering. I would think that there are other solutions out there too worth considering. In fact, some of the ones that you mention yourself.

I have to first say despite my general loathing of the posts of Whynot and my intermittent loathing of CTK's postings, the last couple of posts of both have been the best ever on the Brooklynian.

I am a bit surprised at CTK's query because I thought I was echoing his argument about home ownership by lower income folk.

For the record I think that there ought to be an assessment of what marketable value section 8 housing has. The question should be raised, 'Were this Section 8 housing to be sold on the free market, what value ought it to hold?' And whatever price that may be, the holders of said property ought to be told that the value of their property was 'X' and they have time Y to pay it, and if they do not, then all powers of these United States will be moved to take them off the property. Also, if this property were to have value above a sub prime market value, then said owners could not sell it for above a sub prime market if they were not tenants in said property for a certain amount of time.

CTK asks questions that imply, 'How is this possible' ? My response could, believe it or not, be more academic and arcane, but I ask you, 'You mean to tell me we could put motherfuckers on the moon, but we can't figure this basic shit out!?' Of course we can.

Implicit in an attempt at finding solution to this issue is the agreement that value is something subject to alteration. We create value. If some hi-falutin' hi-yellow niggers live in a house, it has more value than a house lived in by some crackhead niggers (Whitefolks, don't you wish you could talk like this?). Essentially, how value is assessed is a subjective dynamic process. Ain't no hipsters dying to live in Section 8 housing. However, if Section 8 housing is privatized and as a result becomes a commodity, no doubt some will. I say give the poor an ultimatum: own this property, or else.

CTK, what do you think? Were the free market to be expanded to include the privatization of Section 8 Housing, don't you think the rents that are 'too damn high' would diminish, and there would be more freedom in the free market?

MHA wrote: I have to first say despite my general loathing of the posts of Whynot and my intermittent loathing of CTK's postings, the last couple of posts of both have been the best ever on the Brooklynian.

Thanks. And thanks to krowonhill & whynot as well.

MHA wrote:
The question should be raised, 'Were this Section 8 housing to be sold on the free market, what value ought it to hold?' And whatever price that may be, the holders of said property ought to be told that the value of their property was 'X' and they have time Y to pay it, and if they do not, then all powers of these United States will be moved to take them off the property. Also, if this property were to have value above a sub prime market value, then said owners could not sell it for above a sub prime market if they were not tenants in said property for a certain amount of time.

The short answer to this question is that there are no financing vehicles available that would enable Section 8 residents to simultaneously afford the properties they live in and pay at a rate that they can afford. Remember- Section 8 residents pay at most 30% of the market rate, so the total avg rate is most likely much lower. Rents of older buildings tend to be lower than rents & mortgages of newly financed buildings because of the higher profit margins afforded to landlords who've owned a property for some time. So Section 8 residents would face difficulty on 2 fronts- financing 100% of a building with at most 30% of the cashflow, and financing buildings made in 1950-1980 at 2010 prices.

MHA wrote:
CTK asks questions that imply, 'How is this possible' ? My response could, believe it or not, be more academic and arcane, but I ask you, 'You mean to tell me we could put motherfuckers on the moon, but we can't figure this basic shit out!?' Of course we can.

Interestingly enough, you can get a lot done w/a budget that is for all intents and purposes unlimited and a complete vaporizing of all red tape. People always say "its not rocket science"... as an engineer I can say that for those of mathematic/scientific dispositions rocket science isn't that tough. So with the backing of the US govt, getting men on the moon is not that far fetched, assuming we have means of harnessing the energy needed to launch a rocket.

Reversing the effects of unconstitutional pandering to developers and the ensuing displacements of poor people in a dense city that transformed over a decade, with a limited budget and NYC's bureaucracy is indeed more difficult, IMO. I mean we are here still struggling to fully + accurately define the actual problem that needs to be solved, as well as viable conceptual starts to solutions.... this is not as easy as building a rocket and sending it into space, because it's not a problem of such a clear + easily definable scope.

MHA wrote:
Implicit in an attempt at finding solution to this issue is the agreement that value is something subject to alteration. We create value. If some hi-falutin' hi-yellow niggers live in a house, it has more value than a house lived in by some crackhead niggers (Whitefolks, don't you wish you could talk like this?). Essentially, how value is assessed is a subjective dynamic process. Ain't no hipsters dying to live in Section 8 housing. However, if Section 8 housing is privatized and as a result becomes a commodity, no doubt some will. I say give the poor an ultimatum: own this property, or else.

Or else what? They will get booted off the property and displaced by those who can afford to purchase and maintain said properties at market rates? I thought that's exactly what this effort was looking prevent from happening.

MHA wrote:
CTK, what do you think? Were the free market to be expanded to include the privatization of Section 8 Housing, don't you think the rents that are 'too damn high' would diminish, and there would be more freedom in the free market?

To be honest, I think privatizing Section 8 housing would prove disastrous. If this comes off as unfairly harsh, feel free to call me out on this. But I think in many cases America's safety nets have gone too far to build an unrealistic sense of entitlement.

As I mentioned I've done projects in buildings at which only 30% of the apts housed people who were working. Even if somehow ownership was transferred over to them in a way that they could continue to afford the building, these people's rent, food & healthcare is mainly subsidized by the gov't. Would I be wrong to assume that there's not much sense of responsibility in such communities? So I imagine said buildings quickly going into foreclosure & general states of disrepair quickly, and the programs ending up in failure. Said tenants would either have to be saved by the NYC govt or booted from property; in the latter case of course developers would swoop in and get the building occupied at market rates; most likely catering to the more profitable "luxury" market, bringing us back to square one.

I think transfer of ownership would work for people like us, who truly do respect & honor the value of one's home, stoop, block, community, etc, but just can't afford to buy at current market rates. NYC is strange in that a given unit will rent for much cheaper than it would cost to own on a monthly basis, which stems from the meteoric rises in NYC property value since Dinkins left, and is why the vast majority of NYCers rent. I think in that I've struck at one of the fundamental issues... if somehow either market forces or the gov't could make ownership easier for all in NYC, we'd all be better off and higher staked in our homes and neighborhoods, and much, much better equipped to deal with the forces of gentrification, efc.

I think that if buying were more of a reality for the avg NYer, more people would commit to staying. Pretty much the only reason I plan on leaving is because I'm tired of pissing rent away. My career, as well as my gfs, thrive here, and while winter sucks, generally speaking NY is a pretty cool place to live if you can afford it. I think lower + middle income people would be more willing to stay if they could build equity in the places they live, which would solve a lot more problems than merely lowering rent...

If my postings are confusing, I apologize... I'm just kind of posting thoughts as they come to me. Time to take a break, I'm curious to hear what you guys have to say.

CTK, it's really hard to gather up the gumption to respond to you here while on another thread you are calling me a racist, and a liar... Until you take that back, I will not respond.

This first agency is the "big fish" that often makes such low income ownership developments happen.

http://www.nychdc.com/

They sometimes build their own stuff, such as these
http://www.nychdc.com/Featured_Development/featuredev.html

or issue bonds to smaller corporations who do similar work
http://www.housingpartnership.com/about/mission.php

....the big criticism of the process I've heard is that (even given the low loan rates and gov subsidies) the programs construct housing that remains out of reach of many people.

Needless to say, the housing is also in incredible demand. They have lotteries and things to try to keep the process fair

CTK, let''s talk affordable housing.....

No apology, no discourse dude.

On a much smaller scale, I like how this link shows what small landlords should think about as they consider whether to join the rent stabilization program.

http://www.brownstoner.com/forum/archives/2010/11/is_it_worth_bec.php#comments

Creating affordable housing is simply a matter of dollars and cents (sense?)