Is New York City housing getting more affordable?
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According to a recent article by the Wall Street Journal, New York City housing may, in fact, be consuming less of our hard-earned dollars. Housing costs are responsible for an increasingly smaller chunk of New Yorkers’ monthly budget, a new U.S. Census Bureau survey shows. The survey, conducted every three years, points to a record amount of new housing and a rental vacancy rate that’s the third-highest since the survey first began in 1965. The Census Bureau survey found that the number of housing units had increased by 117,000 since 2011, a number that includes over 35,000 more rental apartments and 15,000 condos due to arrive in 2018 and 2019.
A big uptick in construction over the past few years coupled with a strong economy and job growth have put the brakes on rising rents, according to the Journal, with the same economic gains even reaching lower-income groups. According to James Parrott, an economist at the Center for New York City Affairs at The New School, “A nearly decadelong rising economic tide really is starting to lift all boats. The trends are all positive and encouraging and bode well for improved rental housing affordability.”
The report found a 3.63 percent vacancy rate across the city; that rate reached a peak of 4.01 percent in 1996 (when the city is said to have been recovering from a local recession), with the current rate coming in second since 1965. The news is similar for all types of housing: The Manhattan vacancy rate was 4.73 percent–6.07 percent for market-rate housing, and 8.74 percent for all types of housing renting for at least a $2,500/month; housing supply is beginning to catch up with demand. However, Mark Willis, a senior policy fellow at the NYU Furman Center, noted that this effect was uneven, with vacancy as low as 2.71 percent in the Bronx, for example.
In the meantime, renters’ household income rose 11 percent over the recent three-year period, with rents rising 8.2 percent. According to New York City housing commissioner Maria Torres-Springer, “The city is still facing a dire affordability crisis,” and the administration plans to keep building and working to preserve existing affordable homes, and continue to keep rent laws strong.
Some analysts wonder, however, whether the higher income statistics pertain mostly to already higher-income tenants moving into luxury properties that are, by city law, covered by rent regulation. Rent laws require that rent regulation be dropped if the the overall vacancy rate tops 5 percent. Experts say the City Council will likely continue regulation in full, though landlord groups would like to remove some categories of housing–such as Manhattan apartments and those renting for $2,000 or more–from rent regulation.
[Via WSJ]
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