In a move that angered everyone and pleased precisely nobody, the city’s Rent Guidelines Board voted last night in a meeting at Cooper Union to increase the rent on rent-stabilized apartments by one percent. That’s after Mayor Bill de Blasio called for a rent freeze , saying at an unrelated press conference that the city is locked in an “unfair pattern.”
“We’ve had a pattern in recent years of tenants being charged substantial increases,” he said at the presser yesterday, “while the actual costs to landlords did not increase anywhere near the same amount.”
The mayor’s words were apparently for naught. As the Times points out, two of the six people de Blasio appointed to the board actually voted in favor of the increase.
New York Communities for Change, a non-profit that advocates for low- and middle-income families, circulated a petition for months before the vote took place, calling on the board to freeze the rents, as did many other advocacy groups, including Make the Road New York and the Metropolitan Housing Council. As the vote took place, tenants’ rights groups and affordable housing organizations packed Cooper Union’s Great Hall, shouting, waving signs, and generally making their displeasure known:
— tina susman (@tinasusman) June 23, 2014
— Linda B. Rosenthal (@LindaBRosenthal) June 23, 2014
After the vote, the board beat a hasty retreat as irate tenants stormed the stage:
— Marla Diamond (@MDiamond8) June 24, 2014
The mayor’s office has tried to position the one-percent increase as some sort of victory, with spokesperson Wiley Norvell telling the Times he’s heartened that the increase is a “historic low.” A $2,000 apartment, for example, will see an increase of $20.
Landlords have argued that some type of increase is necessary to keep up with the cost of maintaining the city’s apartment buildings. But the Rent Guidelines Board’s own annual Income and Expense Study found that in every part of the city, the increase in revenue that the city’s landlords are making has outpaced what they’re spending to maintain their buildings. Between 2011 and 2012, average operating costs rose about 3 percent across the city, according to the report. But every borough has also seen an increase in annual Net Operating Income, the money left over after a landlord pays their operations and maintenance costs, but before they pay taxes.
Landlords who own property in the “core” of Manhattan (as opposed to upper Manhattan) see the healthiest profit margin, but everyone’s doing just fine. As the report says:
On average, apartments in rent-stabilized buildings generated $436 of net income per month in 2012, with units in post-war buildings earning more ($542 per
month) than those in pre-war buildings ($398 per month). Average monthly NOI tended to be greater for stabilized properties in Manhattan ($704) than for those in the other boroughs: $386 in Queens; $357 inBrooklyn; $344 in Staten Island; and $251 per unit per month in the Bronx. There was a sizable differencewhen looking at NOI on a sub-borough level in Manhattan. Core Manhattan properties earned on average $928 per unit per month in NOI, while properties in Upper Manhattan had an NOI of $397.
The monthly NOI average calculated Citywide, excluding Core Manhattan, was $347.
The rent increase will do nothing to pacify property owners looking for more money, and won’t help people already struggling to pay their rent. The Metropolitan Council on Housing issued a mostly dejected statement on Facebook last night, writing that they were “disappointed” by the vote, but still encouraged that it’s the lowest increase in the city’s history.
“We still feel all financial and economic data warranted a rent rollback, and the fact that the tenant movement and the mayor could not accomplish a rent freeze this year shows we have a lot of work to do,” the statement adds. “Ultimately, we must work together to repeal vacancy deregulation and strengthen our rent laws in 2015.”
The rent, in other words, will remain too damn high, and according to another report by the RGB, there still isn’t enough housing to go around.