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New York City has long ruled headlines for having some of the nation’s highest rents, with the median rent for the city reaching $3,799 — a new high — in July.
The precipitous rise in rental costs has pushed housing advocates to call out landlords for allegedly sitting on thousands of rentable, rent-stabilized units; however, it’s been difficult for analysts to determine the exact scope of the issue due to poor data quality.
The New York City Independent Budget Office (NYCIBO) attempted to provide more clarity on Monday, through its analysis of the New York State Homes and Community Renewal (HCR) 2022 apartment registration data. HCR’s data accounts for approximately 880,000 rent-stabilized apartments across the city.
The NYCIBO said rent vacancies reached a peak of 60,000 in 2021; however, two-thirds of those units were occupied by 2022. But the number of holdover vacancies (i.e. units empty for two consecutive years) increased 8 percent year over year from 12,300 in 2021 to 13,362 in 2022.
Despite the increase in holdover vacancies, the overall vacancy rate for rent-stabilized apartments dropped from 7 percent in 2021 to 5 percent in 2022, something the NYCIBO said reflects residents’ returns after the initial height of COVID-19 infections in the city.
“There’s going to be vacant apartments but what we wanted to answer in this project is, are these part of natural turnover, or are these apartments that are sitting vacant over multiple years?” IBO Assistant Director Sarah Stefanski told Gothamist on Monday.
Stefanski and her colleagues admitted HCR’s data set was incomplete as landlords don’t register their units or register them late, which means they aren’t included in the 2022 count.
Since the report went live on Monday, landlord and renter advocates have used NYCIBO’s data as fuel for their respective arguments about supposed warehousing, the term used to describe the practice where landlords allegedly keep blocks of unrented units off the market to create scarcity and push up prices.
Landlord group the Community Housing Improvement Program told The Real Deal the rise in holdover vacancies proves landlords aren’t sitting on rentable units. Instead, CHIP said, the data reflects the number of landlords who are holding on to old units they can’t afford to renovate and re-rent under current regulations.
“The number of overall vacancies should be dramatically lower, but the current laws are forcing thousands of apartments to stay empty,” CHIP Executive Director Jay Martin told the NYC-based publication on Tuesday.
Martin said CHIP has been lobbying for state legislators to change regulations that limit recoverable renovation costs at $15,000 over 15 years, as many landlords estimate the work needed to make old units rentable can cost six figures. CHIP said current renovation grants aren’t enough to help and are lobbying for a “rent reset” for units coming off long-term tenancies so landlords can recoup costs.
“The data lags, the registration filings lag, but the trend is clear and proves our argument,” he added.
Meanwhile, renters say the increase in long-term vacancies is simply due to landlord greed and an attempt to goad legislators into changing current rent stabilization laws.
“Time to abolish landlords,” a Gothamist commenter said. “Tenants’ unions, keep going!”
Stefanski and NYCIBO Director Louisa Chafee told Gothamist the study’s results don’t support or dispute warehousing theories as incomplete data sets make it “impossible” to know if landlords are purposely sitting on rentable inventory.
Either way, NYC Department of Housing Preservation & Development Assistant Commissioner Lucy Joffe said one thing is clear: New York City needs more affordable housing.
“We do not have a lot of low-cost vacant units,” Joffe told Gothamist. “The dearth of units available for rent on any given day in our city is one of the main problems in our housing market.”