Photo: Drew Angerer/Getty Images
A financial analysis revealed this week by New York City Rental Guidelines Board shows that the owners of 8.8% of rent-stabilized apartment buildings They are going through serious financial problems. Two years ago, that figure was no more than 6%.
In addition, the report shows the photograph of a series of “red numbers”, which are giving support material to the ‘landlords’ to request a “significant” increase in rent for these units.
First, make sure that its net earnings plummeted by 9% between 2020 and 2021 when the coronavirus hit the five counties.
Second, it is specified that the owners earn an average of $1,667 per apartment per month while spending an average of $1,091 in operating costs, including taxes, insurance, and labor.
That leaves about $576 in earnings per apartment each month, much less than the previous year. In this sense, the groups of owners say that a large part of that income goes to mortgages.
This year’s study is based on data reported by owners of about 14,900 buildings with more than 600,000 units since 2021, the second year of the pandemic.
The further decline in earnings it occurred in the so-called “Core Manhattan”, that is to say to the south of the west of the street 110 and the east of the street 96, which experienced an exodus of wealthier tenants during the worst days of the public health crisis, which left units empty for much of 2021.
A double digit increase
But ultimately, as tenant advocates warn, this report will be the first step in a months-long process to determine how much rents will rise for the city’s nearly 1 million regulated apartments. A point that must be decided at a meeting in June that brings together representatives of owners and tenants.
In fact, landlord groups seized on data from the report to call for a “big increase” in rents. Some even propose pushing a double-digit increase.
“The fight is not just financial, but the health of affordable housing with stabilized city rent is deteriorating”commented to local media Vito Signorilevice president of the Rent Stabilization Association, an association of large landlords.
Last year, the board raised rents by 3.25% for one-year leases and 5% for two-year leases. This is the biggest increase since 2013. During the Administration of Mayor Bill de Blasio, the board voted three times to freeze any increase in rent for these types of units.
In addition, this year there is another point “on the coals”, since interest rates are much higher than months ago and the owners argue that they have great difficulty in refinancing their loans when they come due.
Legal Aid: “An incomplete report”
In this context, some defense groups are already showing their “fangs”.
In a statement, spokespersons for the Legal Aid Society, which represents thousands of tenants, consider that this report does not take into account the tens of millions of dollars that the owners have obtained for the gains from raising rents to unprecedented levels in the Big Apple.
“These findings do not reflect the current struggles facing local tenants, particularly the increase in Eviction Petitions and Executed Evictionsas well as high inflation and the skyrocketing cost of living in New York City,” Legal Aid remarked.
For their part, spokespersons for the Community Service Society reacted to the data saying that the greatest impact is concentrated in the wealthiest communities, which were emptied during the pandemic, which led to a collection of Lower median rent and lower owner income.
“Neighborhoods in the city’s working and middle-class neighborhoods, like all community districts in The Bronx, East Flatbush or North Shore of Staten Island, where tenants did not have the option to flee the city, they saw their rents rise disproportionately,” this organization said in a statement.
They also urged the Rent Guidelines Board not to “reward landlords with a significant increase in rent,” based on Old data mainly reflecting losses in the unstabilized Manhattan marketespecially as net operating income continues to rise at a 50 percent since 1990.
The data: New York City has 1 million rent-stabilized apartments, about 44% of all available units.
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