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New York's rent controls: 'essential for the future of the city' New York's rent controls: 'essential for the future of the city'
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Manhattan has a high proportion of renters compared with central London and other cities around the world, with 77% of households renting rather than owning their homes, according to the National Low Income Housing Coalition.Manhattan has a high proportion of renters compared with central London and other cities around the world, with 77% of households renting rather than owning their homes, according to the National Low Income Housing Coalition.
The median average rent in Manhattan increased for the 17th consecutive month in July to $3,418 (£2,190) – the second highest on record and 6.6% higher than July 2014. But New York City’s rent controls, which were first introduced in 1943 and are the longest-running in the US, now only apply to about 38,000 apartments out of more than 2m residential units in the city.
This means the median rent in Manhattan, according to estate agents Douglas Elliman, equates to 64% of the average Manhattan monthly salary, which is $5,308.
The monthly Douglas Elliman survey uses median, rather than mean, average rents because the vast amounts paid for super-luxury apartments skews the data. The mean average monthly rent in Manhattan in July was $4,031.
The average rent paid in the top 10% of the market was $9,910 a month, or $73.66 per sq ft. Even for a studio apartment, the average rent was $2,669.
Related: Too damn high: Manhattan average apartment prices reach record of $1.87m
Nonetheless, across New York about 1m homes are subject to regulations that govern the cost of rent and prevent in-contract rent spikes.
Carl Weisbrod, chairman of the New York City planning commission, says rent regulation “is essential for the future of the city, for its economic goals, for social equality to make a city attractive and available for all, rich, poor and middle class”.
New York’s mayor, Bill de Blasio, is insisting rental controls are preserved, to ensure the stock of affordable housing is not reduced, and is championing a $6.7bn investment programme to support affordable housing for the middle classes as well as low earners.New York’s mayor, Bill de Blasio, is insisting rental controls are preserved, to ensure the stock of affordable housing is not reduced, and is championing a $6.7bn investment programme to support affordable housing for the middle classes as well as low earners.
Weisbrod said this will ensure New York remains “an exciting place to live” and is not emptied out of all but the extremely rich and extremely poor. Related: Sky-high London rents prompt calls for new controls on landlords
He says the biggest job growth in 2014 has been in health, tech and creative industries, and the city needs workers in those sectors to live in the capital to ensure its economic viability. Carl Weisbrod, chairman of the New York City planning commission, said rent regulation “is essential for the future of the city, for its economic goals, for social equality to make a city attractive and available for all, rich, poor and middle class”.
Weisbrod added that the programme will ensure New York remains “an exciting place to live” and is not emptied out of all but the extremely rich and extremely poor.
He said the biggest job growth in 2014 had been in health, tech and creative industries, and the city needed workers in those sectors to live in the capital to ensure its economic viability.
“In London and New York, we both pride ourselves on the diversity of our cities. That’s one of the reasons why people want to come to our cities and ensures they are the economic engines they are.”“In London and New York, we both pride ourselves on the diversity of our cities. That’s one of the reasons why people want to come to our cities and ensures they are the economic engines they are.”
Related: Snakes and ladders for tenants as Berlin rent cap starts to bite
To qualify for rent control in New York, a tenant (or family member) must have been continuously living in an apartment since July 1971 (and it only applies to buildings with more than six apartment units). Under the controls, a landlord can increase rent by up to 7.5% every two years until a maximum base rent is reached.
When a rent-controlled apartment becomes vacant, it either becomes rent-stabilised or is removed from regulation. Rents at rent-stabilised apartments are set yearly by the Rent Guidelines Board. In June the board voted to freeze rents – the first time in its 46-year history that it has not increased them.
The freeze comes as one estate agent said rent made up about two-thirds of the average Manhattan salary of about $5,300 (£3,385).
The monthly Douglas Elliman survey uses median, rather than average rents because the vast amounts paid for super-luxury apartments skews the data. The median rent for Manhattan was $3,418 in July, where as the average monthly rent was $4,031.
The average rent paid in the top 10% of the market was $9,910 a month, or $73.66 a sq ft. Even for a studio apartment, the average rent was $2,669.