It’s Official: City’s Housing Crisis Is Worse
by Steven Wishnia

Despite a small increase in the size and quality of New York’s housing supply, the city’s affordable-housing crisis continues to get worse, according to the 1999 federal Housing and Vacancy Survey.

The survey, commissioned every three years by the city Department of Housing Preservation and Development, found that rents are up, overcrowding is increasing, and the number of affordable apartments on the market dropped drastically between 1996 and 1999.

“The number of low-rent units declined and the number of high-rent units increased noticeably,” said a summary of the survey’s findings released in February.

The HVS also found that one out of every nine rental apartments in the city is occupied by more than one person per room.

The overall housing supply in the city rose by 44,000 units, to just over 3 million, according to the survey. But the number of rental units fell by 10,000, to 2,018,000, and the number of vacant apartments available for rent dropped from 81,000 to 64,000. Citywide, this translates into a rental-vacancy rate of 3.2%—down from 4% in 1996, and well below the 5% rate that is the legal justification for rent regulations.

The housing shortage was most acute in immigrant-laden Queens, where the vacancy rate fell from 3.3% to 2.1%, leaving barely 9,000 apartments available in the entire borough. Manhattan’s vacancy rate was 2.6%, while the Bronx’s dropped to 5% and Staten Island’s rose to 5.8%.

Low-rent apartments are especially hard to find. Only 1.3% of apartments renting for less than $400 a month were available for rent, while the rate for apartments renting for $400 to $499 was 2.5%. In contrast, the vacancy rate was 5.7% for apartments renting for over $1,750, and 7.1% for those in the deregulated zone, over $2,000.

The survey documents a steady erosion in affordable rental housing in the city, exacerbated by the loopholes punched into rent controls by the Legislature’s awls in 1971, 1993, and 1997. The number of rent-regulated apartments fell by 24,000, to just over 1.1 million. Most of that decline came in rent-controlled apartments; only 52,000 remain. Only about 40% of the apartments available for rent were regulated, and the vacancy rate for rent-stabilized apartments dropped from 3.6% to 2.5%.

In contrast, apartments renting for over $1,750 a month are now 13% of the total available, up from about 2% in 1996.

Overall, nearly half the occupied rental housing in the city costs from $600 to $999 a month. However, the supply of under-$700 apartments is dwindling. Even when 1996 rents are adjusted upwards for inflation, the city still lost 67,000 under-$700 rentals—from 1,027,000 to 960,000, a 6.5% decline.

Meanwhile, the number of over-$1,250 apartments jumped by over 25%, from 149,000 to 187,000. Most of that increase came in the over-$1,750 category. Overall, the median “contract rent”—the amount on the lease—rose from $600 in 1996 to $648, slightly more than inflation. The median “gross rent”—the amount paid once heat and fuel costs paid by the tenant are factored in—rose from $640 to $700. Tenant incomes more or less kept pace; tenants now pay a median 29.2% of their income for rent, down from 30% in 1996. (This still means that close to half of all tenants pay more than 30% of their income for rent.)

The median income for all tenants in 1998 was $26,000, up slightly from 1995 after inflation is factored in. For rent-stabilized tenants, it was $27,000, a slight drop after inflation. Rent-controlled tenants had a median income of $18,000, a significant increase that contributed to the drop in the amount of tenants living below the poverty line, from 26.3% to 24.5%.

The quality of the housing available is increasing—the survey reported a “dilapidation rate” of 1%, the lowest in its 35-year history. Over 45% of the apartments had no “maintenance deficiencies,” and less than one-sixth of the tenants surveyed reported having to go without heat during the previous year. The number of tenants reporting living near buildings with broken or boarded-up windows fell to less than 9%.

Yet with the price of housing rising, many people can’t afford to pay for these improvements. The number of apartments defined as overcrowded, occupied by more than one person per room, rose from 10.3% to 11%. A more detailed analysis of the final survey will appear in a later issue.