New York passing sweeping new rent control rules

[Gantz]

Originally Posted by Crawford

If this goes through, and the inevitable lawsuits are unsuccessful, you'll see an enormous conversion push, because there's no way to make money on rental housing. Basically every landlord will plot how to do a coop or condo conversion.

And this is Example 807,211 that populism, whether on the Right or Left, is dangerous and stupid. When a politician claims to be "for the people", be very afraid.

These things are not cheap or quick. These laws will basically squeeze out any small landlords, because they wouldn't be able to afford buyouts or keep running on low margins for years, plus legal fees and court battles. As a developer, you'd also be an idiot to construct rental and not condos now. Why the hell would you create an asset with such a limited upside. Your income is literally capped by the government. People were already complaining that NYC developers were constructing too many luxury condos, wait till people realize wtf just happened. I think also how these laws were written, they made the low income portion of all 80/20 buildings effectively into RS...I think they'd have to tweak the wording on the bill.

[maru2501]

I vote tweak it

there is something to be said to offer some protection to the "lower" end and keep every normal person from being priced out of there. Who wants to literally be a giant SF

if you're charging $4,000 a month for a studio you can paint a damn wall or whatever

[JManc]

Originally Posted by Hudson11

New York is being over progressive. There's trying to set an example to the nation and then there's establishing an anti-business environment. It really feels more like the latter recently.

The thing is, New York (State or City) was never really that progressive. It was solidly liberal but was always more or less middle of the road. Even in the city. The rush to be like San Francisco is not a good look on them. People in Upstate are going bonkers because it impacts policy statewide.

[Pedestrian]

Originally Posted by JManc

The thing is, New York (State or City) was never really that progressive. It was solidly liberal but was always more or less middle of the road. Even in the city. The rush to be like San Francisco is not a good look on them. People in Upstate are going bonkers because it impacts policy statewide.

But is this really like San Francisco? SF has "vacancy decontrol". That is, when somebody moves out the rent can be raised to market levels. And rent control only applies to many (not all) units built before 1979, not to new construction. So it doesn't really hold down market rents and it doesn't disincentivize new building.

[JManc]

Originally Posted by Pedestrian

But is this really like San Francisco? SF has "vacancy decontrol". That is, when somebody moves out the rent can be raised to market levels. And rent control only applies to many (not all) units built before 1979, not to new construction. So it doesn't really hold down market rents and it doesn't disincentivize new building.

I am strictly talking politically, not so much about rent. New York always had some form of rent control but New York always looked at California as the "left coast" and where as lately, folks like De Blasio and many downstate politicians are following their example.

[the urban politician]

Originally Posted by JManc

I am strictly talking politically, not so much about rent. New York always had some form of rent control but New York always looked at California as the "left coast" and where as lately, folks like De Blasio and many downstate politicians are following their example.

I view it as a nationwide trend among Democrats who are increasingly shifting left.

[chris08876]

Originally Posted by JManc

I am strictly talking politically, not so much about rent. New York always had some form of rent control but New York always looked at California as the "left coast" and where as lately, folks like De Blasio and many downstate politicians are following their example.

O god no. I surely hope they don't use California as a model, please no. There needs to be some balance. It just can't be liberal utopia in NYC. There needs to be some balance.

[Obadno]

I dont understand why Deblasio and Cuomo are so intent on enacting these kinds of policies when NYC has been doing fantastic, probably one of the better periods in the cities history (recessions not withstanding) from the late 1990's to now.

The improvements from how NYC was in the 60's-90's is astounding. What is driving the desire to kill the progress?

[the urban politician]

Originally Posted by Obadno

What is driving the desire to kill the progress?

"Spread the wealth around!"

[chris08876]

The people need to make the right choices in the next election. If you ask New Yorkers on the streets what they really feel, its a different story. A lot of them are pissed. And sadly, some do want to leave. Its a shame really.

I think they will make the right choices come the next election. Folks here have been through bs times, and have prevailed in the end.

[Jonesy55]

Seems bizarre to apply this to the whole of New York state, surely what might work to reduce rents in Manhattan might not work as intended in rust belt areas upstate?

I'd like to know more detail of what is being proposed before making judgement, if it makes landlords sell their properties then it might reduce prices to buy and therefore increase home ownership, but I guess the main beneficiaries of that will be relatively high income renters in expensive areas rather than the low income folks who will still be priced out from owning.

Landlords will obviously try to cut back on maintenance and investment in the properties if they won't get increased rents from spending that money which in the long term will be a problem.

If it doesn't apply to new build homes then it's likely to create a two-tier market with investment in housing moving away from maintaining existing homes into building new homes, but in the most expensive places like Manhattan I guess there aren't many free plots to build new homes so it might focus more investment in suburban areas while allowing core city housing to fall into disrepair. It will be interesting to see how it pans out.

Also this week Berlin has made moves towards introducing a 5 year freeze on rent increases, which if passed will be another interesting test case to see how rent restrictions work in practical terms.

[Pedestrian]

Originally Posted by chris08876

O god no. I surely hope they don't use California as a model, please no. There needs to be some balance. It just can't be liberal utopia in NYC. There needs to be some balance.

They don't have to look to California. If they want a model of government over-reach ruining an economy, they only have to look to New Jersey and, especially, Connecticut.

The state (Connecticut) has lost population for the last five years. In 2016 GE announced it would move its longtime headquarters from Fairfield to Boston. Hallmark, RBS, Bristol-Myers Squibb , Boehringer Ingelheim Pharmaceuticals and Rogers Corp. have also announced job cuts or moves. Alexion Pharmaceuticals , which received $26 million from the state, checked out of New Haven in 2017.

The exodus has depressed tax revenue. While United Technologies will continue making jet engines in Connecticut, at least for now, 100 high-paying corporate jobs will move to Boston. Massachusetts has a flat 5.1% income tax.

By the way, Democrats in New Jersey who raised the corporate rate last year to 11.5% from 9% are now negotiating an extension of business tax breaks to prevent companies from bolting . . . .

https://www.wsj.com/articles/a-conne...s&page=1&pos=2

[LosAngelesSportsFan]

Originally Posted by Obadno

I dont understand why Deblasio and Cuomo are so intent on enacting these kinds of policies when NYC has been doing fantastic, probably one of the better periods in the cities history (recessions not withstanding) from the late 1990's to now.

The improvements from how NYC was in the 60's-90's is astounding. What is driving the desire to kill the progress?

Because more and more, Manhattan and NYC are becoming a bland place thats losing its creative edge and its now a place where only the super wealthy can afford.

[jd3189]

I’m ambivalent about this. It is bad for the landlords, but if most of your tenants can’t afford to live in your building, would you still be making money to make ends meet?

[jtown,man]

Originally Posted by Pedestrian

They don't have to look to California. If they want a model of government over-reach ruining an economy, they only have to look to New Jersey and, especially, Connecticut.


https://www.wsj.com/articles/a-conne...s&page=1&pos=2

I admittedly know very little about the NE but I always thought NJ was a high-tax state, CT had many issues, and MA tempered their liberalism by creating a good safetly-net while attracting a lot of high-skilled workers and keeping businesses in the state by not being hostile to them.

[jtown,man]

Originally Posted by LosAngelesSportsFan

Because more and more, Manhattan and NYC are becoming a bland place thats losing its creative edge and its now a place where only the super wealthy can afford.

Of the 8.5 million people in NYC, how many would you consider "super wealthy?"

[floor23]

It's an incredibly short-sighted bill and it will most likely be revised in a couple years.

Apparently Berlin also passed legislation regarding rent control. Interesting read.

https://uk.reuters.com/article/uk-ge...-idUKKCN1TJ1O9

https://www.independent.co.uk/news/w...-a8964436.html

[Crawford]

Originally Posted by Jonesy55

Seems bizarre to apply this to the whole of New York state, surely what might work to reduce rents in Manhattan might not work as intended in rust belt areas upstate?

It isn't statewide; rather statewide municipalities have the option of opting in (which they won't). It's an idiotic law, and will make housing more expensive in NYC + suburbs, though.

[Crawford]

Originally Posted by Pedestrian

They don't have to look to California. If they want a model of government over-reach ruining an economy, they only have to look to New Jersey and, especially, Connecticut.

Connecticut is the wealthiest state in the country, and NJ is like #2 or #3. And CA is the innovation center of the planet and top 10 in wealth. Pretty good company, and if those are examples of a "ruined economy", I'll take it.

Also, CT still is (overall) lower tax than NY & NJ. Property taxes are much lower, while income taxes are roughly similar.

And it has nothing to do with "government overreach", the public in these states consistently votes to tax themselves for better services, whether the localities are conservative or liberal. Gold-plated schools and municipal services drive the tax burden. Whether that's good or bad, I don't know, but it's democracy in action.

[Crawford]

Originally Posted by JManc

I am strictly talking politically, not so much about rent. New York always had some form of rent control but New York always looked at California as the "left coast" and where as lately, folks like De Blasio and many downstate politicians are following their example.

When it comes to housing issues, NYC has always been far to the left of CA.

The large majority of housing units in NYC have been under some form of rent regulation for over a century, since WW1, and housing is legally a human right, requiring the city house anyone who displays need (which is one reason you see fewer homeless in NYC; the city is already housing them on taxpayer dime).

And DeBlasio is probably the most far left mayor in the U.S. I think he sucks, BTW, but less for political reasons and more because he's a unthoughtful party hack.