Alms for the Upper Middle Class: Subsidized Apartments Aim at $200K Earners

 

 

 

 

By Stephen Jacob Smith

Standing outside a shiny new red and tan brick building at 401 West 25th Street, indistinguishable from any other late-2000s new construction throughout the West Side, you can catch a glimpse of the future of housing if New York City’s Democratic mayoral candidates get their way.

A young woman who works in finance and moved into this building from a “real shithole” in the West Village, a computer programmer from South Carolina, a lifelong New Yorker who moved in from the projects a few blocks south, and a gay couple—one a playwright, the other a social worker—with a son, who moved from 14th Street and Seventh Avenue.

Inside an Elliott-Chelsea apartment.

They all found places in a 22-story middle-income affordable housing development in an increasingly unaffordable Chelsea. The Elliott-Chelsea, developed by Artimus Construction, rose on New York City Housing Authority property with the help of an alphabet soup of government agencies. Some of the 168 units in the  building are typical low-income units, reserved for families earning under $40,000 a year. But the bulk of the complex is set aside for middle-income earners, a group that this cycle’s crop of Democratic mayoral candidates is eager to court.

Some of these units can legitimately be called middle-income apartments, with half a dozen one-bedroom apartments available to couples earning a combined $64,000 to $101,000 a year. But there are also 45 two-bedrooms that go for $3,421 a month, for households, no matter the size, ranging in income from $119,143 to $190,080. In the world of New York City affordable housing, this is what passes for middle-income.

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Bill de Blasio Unveils Affordable Housing Plan: 190,000 Units, Legalized Granny Flats and More

 

Until now, Bill de Blasio’s housing platform has mainly consisted of sniping at frontrunner Christine Quinn. But no longer: this afternoon Mr. de Blasio announced measures he would take mayor to curb what he calls the “full-blown crisis” of affordable housing. (Old habits, though, do die hard: Mr. de Blasio did take another shot at Ms. Quinn, saying, “Letting the real estate industry keep calling all the shots with our affordable housing policy isn’t going to deliver what working people need”—an allusion to her tax credits-for-affordable housing plan, which seems cribbed right from REBNY and Steve Ross’s proposals back in 2011.)

Public Advocate Bill de Blasio unveiled his housing platform today in Williamsburg, where housing prices have nearly tripled since 2004.

Mr. de Blasio started out, as all candidates do, with a promise for the number of affordable housing units he’d create: 100,000 “new affordable units,” plus preservation for “nearly 90,000″ others.

As a comparison, Ms. Quinn called for the construction of “40,000 new middle-income affordable apartments.” In 2005 Mayor Bloomberg wanted to build 92,000 units and preserve 73,000 by 2014, but the number of new units was revised downwards to 60,000, with the balance shifted to preservation. In 1985 Ed Koch promised 250,000 new or renovated affordable units over ten years, but only delivered 150,000, the vast majority of which were renovations.

But it’s once you get past Mr. de Blasio’s headline number that things start to get interesting. He calls for “mandating [that] developers include affordable housing in large development” (we used to have a name for this: rent control), which he says will be responsible for half of his 100,000 new affordable units.

He also calls for investing $1 billion from the city’s public pension funds in affordable housing—an interesting proposal, but one that would put city workers’ retirements in jeopardy if this not-highly-remunerative investment doesn’t pan out.

Beyond that, he also has some ideas for how the government can ease constraints on private builders and landlords—a sop to the real estate industry that he decried earlier if you want to be uncharitable about it, or a recognition that the market also has a role to play in creating affordable housing, to put a more generous spin on it.

His first idea piggybacks onto something that Manhattan Borough President Scott Stringer has already gotten behind: legalizing basement apartments and “granny flats” in places where they are currently illegal—namely, the outer boroughs. “Housing experts estimate there are about 100,000 illegal units throughout the city,” City Limits reported back in 2010, unregulated and prone to building and fire code violations, ”housing as many as 500,000 New Yorkers,” with the largest concentration of illegal units in Queens.

(In his press release he mentions bringing them into the “the legal, rent-regulated system,” but his press secretary clarified to The Observer that he would only seek rent controls for units developed through city programs; the rest would simply be brought into “the legal system, like we did with lofts several years ago.”)

His second idea is to allow development rights to be transfered “not just to adjacent properties, but within a neighborhood, in order to encourage more affordable construction.” As it is now, neighborhood-wide transferable development rights only exist within special areas, like around the High Line. Allowing easier air rights transfers across the city—with the vague “affordable construction” caveat—would certainly make it easier to build, though it would also raise the ire of NIMBYs the city over.

Mr. de Blasio also includes a number of other housing issues in his plank, from ”closing the vacant land tax loophole” to “launching a national coalition of mayors and governors to secure more federal investment in affordable housing.”

Though given the secular decline in federal involvement in housing over the past few decades, we wouldn’t hold our breath for that last one. For better or worse, housing is New York City’s problem now.

 

Source: The New York Observer