Today, The Post launches a weeklong series of opinion pieces giving constructive proposals for enhancing New York City in 2023. The first column examines potential solutions to the city’s challenge with affordable housing.
The “housing crisis” in New York does not appear to be abating. Our governor and mayor both utilize the term. However, our efforts to address high costs and a lack of affordability are too narrowly focused on how to supply below-market rental apartments in the five boroughs, whether through tax cuts or regulation of over one million “rent-stabilized” units.
The Empire State has by far the most public and subsidized housing of any state. As of 2021, the federal Department of Housing and Urban Development (HUD) estimated that New York has 591,065 units of publicly “assisted housing,” or three units for every 100 state residents, which is double the national average and the most of any state.
However, our housing crisis persists
The supply side is the source of our problem, and not only in New York City. In reality, constructing new housing outside of Gotham is a time-honored method for reducing pricing pressure in the city. However, throughout the state, zoning laws inhibit the primary source of new housing – private development. In comparison to the national average and even nearby Northeastern states, we significantly lag behind in the construction of both new homes and a diversity of housing styles that bring prices within the grasp of consumers.
Our deficit is stark.
New York State governments issued building permits for 40,135 residential units in single- and multi-family dwellings in 2021, a ratio of only 1.99 units per 1,000 residents, during a time when new housing starts skyrocketed across the country in the aftermath of the epidemic. This was significantly lower than the 50-state median of 4.4 units per 1,000 residents. Even neighboring Massachusetts (2.82), New Jersey (3.99), and Pennsylvania (3.68) permitted more home development.
Similarly worrisome is the dearth of new housing options. In 2021, residential building permits in New York were concentrated in two categories: single-family homes (11,099 units) and apartments in buildings with five or more units (27,510 units).
Permits were issued for only 908 two-family dwellings in the Empire State in 2021, or barely three percent of the total, severely limiting the variety of housing types available, as has been the case in prior years. This “missing middle” in the new multifamily housing market reflects less consumer desires than the stringent single-family zoning prevalent in many towns around the state.
Twenty-five percent of Queens and twenty-two percent of Staten Island remain exclusively designated for single-family homes. In certain regions, a single-family home could neither be replaced nor transformed into a two- or three-family dwelling.
In downstate areas such as Suffolk County, where single-family houses make up more than 81 percent of the housing stock, the situation is more dire. Between 2008 and 2018, Suffolk and nearby Nassau County placed towards the bottom of the nation’s 100 most populous counties in terms of new residential building permits per 1,000 residents.
Solving the problem of restricted supply is less of a financial and more of a political challenge. Suburbs with two-acre or even four-acre zoning must be persuaded that opening their doors more widely would not result in the development of the public housing they understandably fear (given its track record) or substantially increase their property tax loads.
Here, the can state can create a distinction. Importantly, if there is an increase in student enrolment, additional state funding made possible by a loosening of zoning restrictions could help to cover rising public school costs. And local planning boards should also receive the word that new housing within the price range of educators, firefighters, and young families helps to maintain the vitality of towns. New housing could prevent younger New Yorkers from relocating to upstate New York or Florida.
The state should rescind the 2019 extension of rent regulation, which has traditionally contributed to the lack of affordable rental housing options in New York City by discouraging turnover and rewarding those who are not in need. The city must also overhaul its own property tax system, which discourages all apartment development except for luxury units.
The housing crisis in New York can be resolved.
To now, though, public policy has only managed to make it worse.
Howard Husock is an American Enterprise Institute senior scholar and the author of “The Poor Side of Town: And Why We Need It.” This article is based from “The Next New York: Renewing and Reforming the Empire State,” a NextNewYork.net project by the Empire Center.
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