Private investment firms have been amassing what may seem like unusual stakes in New York real estate: they have bought hundreds of apartment buildings with thousands of rent-regulated units across the city that produce decidedly meager returns.
As regulatory filings and promotional materials show, the companies expect to generate higher returns quickly by increasing rents after existing tenants vacate their units. Their success depends upon far higher vacancy rates than are typical in rent-regulated apartments in New York.
Some residents and tenant advocates say that they began seeing what they consider a pattern of harassment of low-income tenants this year and suspect that it is a result of the new owners’ business models. Tenants have been sued repeatedly for unpaid rent that has already been received by the landlords; they have been sent false notices of rent bills, lease terminations and nonrenewals; and they have been accused of illegal sublets.
To generate returns expected by private equity investors and to pay off the debt used for their purchases, tenant advocates say that managers of the properties are intimidating residents in the hopes of forcing them to leave so that rents can be raised.Predatory equity is undermining the best efforts of New York City and state elected officials to slow the loss of affordable housing,” said Benjamin Dulchin, deputy director of the Association for Neighborhood and Housing Development, a nonprofit organization. “Both the private equity funders and the lending institutions are aware, or should be aware, that harassment of tenants is taking place as a result of their financial models.”
Away with you, poor, uncreative people!
To the burbs! To the empty McMansions, with their styrofoam facades!
Here endeth Part I.
Front page
Do you want to handle my investments?
Cuz you seem one step ahead of the pack.
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” … we shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall fight in the hills; we shall never surrender …”- Winston Churchill
Fuck, no
If I were any good at money, I’d have some. And by the time things make it into the papers, it’s too late.
[x] Any (D) in the general. [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.
$2000--the magic number--
All owners are doing all they can to get all rents above that, which is when they drop out of rent-stabilization entirely and can go market-rate.
And they’ve been playing games with all vacant apartments since the 2k number was made law a few years ago—if you put in new windows, you can up the rent between tenants, or a new stove, etc…They want to get all apartments that aren’t rent-controlled (rented by the same people since mid-1970s or before with no annual increases ever) converted to market rate ones.
I’d have to move if they succeeded—most of us would have to—and it would be the absolute deathknell for middleclass NYers altogether.
(Killing Mitchell-Lama hurt enormously too—massive complexes are now market-rate and expensive too —Styvesant Town, Peter Cooper Village, Starrett City, tons of former union-housing ones on the Lower East Side, etc.)
the rules--
“… the Rent Regulation Reform Act of 1997, an occupied and rent-stabilized apartment can be deregulated after its rent reaches $2,000 a month — but only if the household income of the existing tenants is at least $175,000 for two years in a row. If their income is lower, the unit remains stabilized. Once that apartment is vacated, the owner can have the unit deregulated and can charge the next tenant market-rate rents.
As long as an occupied unit is stabilized, the owner can raise the rent only by a percentage agreed upon by the city’s Rent Guidelines Board each year. …
Once those tenants move out, the owner can add a 20 percent increase onto the next two-year lease; he or she can also add one-fortieth of the cost of any improvements made between tenants. …”
— http://www.nytimes.com/2006/08/31/nyregi…
RE: Money
I spent most of my money on alcohol and sins of the flesh.
The rest I just wasted.
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” … we shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall fight in the hills; we shall never surrender …”- Winston Churchill
This isn't new.
What is new is that the NYTimes is covering this story at all. They are extremely biased in favor of landlords and real estate developers. Ad revenue from their classified ads is too important to them to risk pissing off REBNY (or any other powerful real estate group) by actually reporting stories that have an enormous impact on a huge percentage of New Yorkers. The number of major stories that they have simply ignored about tenant abuse and harassment, corruption at the HPD and DOB, illegal evictions, the stacking of the Housing Court with anti-tenant judges is truly astonishing. They usually don’t report these stories until they are shamed by the Daily News or Village Voice into doing so.
Amberglow, you probably already know this, but if you live in a rent regulated building you should get a copy of the rent history for your apartment to make sure that you’re not being overcharged, and that any MCIs that were used to justify a rent increase were legitimate.
Well, I guess
these people won’t be able to move closer to save on gas, huh?
Bill Clinton for First Dude!!!
Bingo!
Got it in one, Aeryl! And the other meme people should stash away is “predatory equity.”
(Iphie, yes, I know it’s not new, but we need to highlight effects like this as urban dwelling becomes a solution to global warming because it’s more energy efficient (which it is). All very well, but poor people are more energy efficient than rich people…
[x] Any (D) in the general. [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.
Absolutely.
I was just saying that it was new for the “Newspaper of Record” to deign to cover the issue.
Cory Booker, the Mayor of Newark, has a lot of interesting ideas to both help Newark become a greener city as well as boost the economy and put people to work. A lot of his ideas and proposals seem to dovetail very nicely with some of Clinton’s ideas about the same. (Booker is, of course, supporting Obama though. Whatev.)
http://www.apolloalliance.org/stateandlo…
Bill Moyers did an interview with him about a month ago where he talked about some of those things — he seems very much to be a get things done type of guy. If you haven’t seen it, you can watch it online.
http://www.pbs.org/moyers/journal/032820…
I read the New Yorker article about Cory Booker
Surprise, he’s got a resume. Here’s [an abstract of]the article, which relates not only to housing, but how the tapeworm economy sucks the life from our localities. (Where do you think the drug money is? Banks, possibly? And so on.)
[x] Any (D) in the general. [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.
Yeah, I read the New Yorker article.
Somewhere in between the time of the New Yorker piece and the Moyers interview, there was an argument swirling around that said Obama was a once in a lifetime candidate and we couldn’t afford to pass up the opportunity to elect a black man president, because who knows when we would have that chance again. Really?
What struck me about Booker is that he has, like you say, an actual resume. He’s incredibly invested in the people of Newark and the job he has today — I have no doubt he has higher ambitions, but right now he wants to make real improvements in a very difficult place. Watching the Moyers interview I was struck by not only how hopeful and optimistic he was, but at his attitude that yes, there are problems, historical and current — we know what they are, we don’t need to keep talking about them — what we need to do is to get to work and start fixing them. His impatience and his energy made me want to get up and start working right next to him.
Give him a couple more years and some success in Newark and he’ll make Obama look like a piker.
Iphie, i'm ok--
i’ve been living in the same 1-bedroom (which i love) since 99—in all this time my rent’s gone from 950 to the 1200s, so i have another 8-10 years or more before i hit 2k. And my rent’s still well below most peoples’ or the avg.
My more immediate problem is that they rezoned my neighborhood because of the westside rail yards and 7 train extension—and giant new buildings are popping up everywhere up and down 10th Ave—everyone in my building is more worried about the owner selling than anything else—and we all make too much to qualify for that 80/20 rule they have for new rentals.
Without knowing all the particulars
1) There are two requirements that must be met before an apartment can qualify for luxury decontrol. They are based on the current registered rent of the apartment and the tenant’s income (combined income if there are multiple tenants). So, even in 8-10 years when your rent hits $2,000 (a level that in 8-10 years will more than likely have increased), your apartment still won’t qualify for luxury decontrol unless and until your income exceeds $200,000/year for 2 years in a row (that $200,000 threshold may have gone up to $250,000/year — there has been talk about increasing it in the past; I haven’t followed it that closely though — doesn’t apply to me). From that perspective, as long as your income doesn’t meet that part of the requirement, you should be pretty safe in that apartment for quite some time. If you move out of the apartment after the rent has reached $2,000, the apartment will be decontrolled for the next tenant under vacancy decontrol provisions.
2) Other than the enormous pain in the ass that the re-zoning and construction is going to cause in that neighborhood, I also wouldn’t worry too much about your landlord selling the building. Even if s/he does, your rent-stabilized lease must be honored by the new owner, which of course, legally requires that landlord to continue to offer you lease-renewals at the rent-board approved percentage increase.
Where you could encounter problems with a new landlord is if that person has it in their mind to try to force you out through intimidation, lies, harassment, etc. Even then, the law is on your side. The people who are most vulnerable to this sort of tactic are those who don’t know their rights — very often the poor and the uneducated.
Sorry if this veered way to far o/t, and sorry if this was way more information than you needed or wanted — it’s just that so many people who live in this city don’t know their rights and landlords end up getting away with bloody murder.