Election time: Rent Freeze defines mayoral race

New York City is at a crossroads. How the city votes in this month’s mayoral election will help determine New York City housing policy for years to come. 

Make a plan to vote on or ahead of June 24 – the day the polls close. The future of the city’s rent-stabilized housing stock hangs in the balance.

This is your New York Apartment Association weekly update with CEO Kenny Burgos.

Follow NYAA on BlueSky: @housing.bsky.social

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Send us questions or comments at podcast@housingny.org 

On The Agenda

1:20: Why a rent freeze is bad for most renters — and why independent experts & The New York Times Editorial Board agree

3:08: SCRIE and DRIE: existing rent-freeze policy that actually works — and our commitment to help qualified renters access the program 

4:07: The Rent Guidelines Board is not the mayor’s plaything

5:30: The FARE Act takes effect: listings pulled off StreetEasy, rent increases reported in Manhattan & REBNY’s ongoing legal challenge to the law.

6:19: NYC to end the Unit Hold Incentive 

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Transcript

 This week on Housing New York, it may be hot outside, but a lot of people are talking about a freeze. We explain why a rent freeze is bad for most renters. Plus, the FARE Act is now law and we're starting to see some of the distortions that we expected. And the city has cut back on vouchers, specifically the incentive for property owners to hold units. I'm gonna talk about why that is a troubling development. 

Let's start housing in New York. 

[THEME]

“We need 800,000 units to meet the demand today. What we have right now in the United States and what we have right now in New York City is almost a crisis of absurdity.”

[INTRO]

Welcome to the Housing New York podcast, I'm your host, Kenny Burgos. We're taping this on Monday, June 16th. Yesterday was Father's Day and the first Father's Day for me. I was woken up by my son at approximately 6:50 AM to a couple smacks in the face, Uh, but then we enjoyed the day at Randall's Island, which is a tradition in my family. I've been going there since I was a child, so it was really touching to take my son to Randall's Island and continue that tradition. 

Okay. On to the news.

[01:20] [Voting “No” on a rent freeze]

We start the podcast talking about a key issue in the Democratic primary for mayor: calls for a rent freeze. This weekend we placed advertisements in The New York Times, the Daily News and the New York Post, highlighting the devastating impacts of a rent freeze on older rent-stabilized housing. The goal of that ad is to promote the independent views of housing experts who are not aligned with our organization, but who see the same things that we see: the defunding of older, rent-stabilized buildings. 

Last week, Rafael Cestero, the CEO of the Community Preservation Corporation, laid out the problem in a very succinct way: This is a crisis that the next mayor of New York City will inherit. 

“Crisis” is not a word that anyone uses lightly, but the reality is that easily one third of the rent-stabilized housing stock is at severe risk. The buildings cannot sustain themselves and when there is financial distress, physical distress will follow. All the data that we have shows that freezing rents, or even rolling them back when adjusting for inflation – which is what the Rent Guidelines Board has done for a decade straight – leads to bankruptcy and foreclosures.

For renters, living in a bankrupt building is horrible. The building has no money to make emergency repairs or even fix small things. The result is a worse quality of life. 

But thankfully, this morning, The New York Times agreed with us in their editorial about the mayor's race. They said a rent freeze has consequences. They wrote of Democratic Socialist candidate Zohran Mamdani, quote “He favors rent freezes that could restrict housing supply and make it harder for younger New Yorkers and new arrivals to afford housing.” Well said. What we need right now is leadership that presents real solutions, not just empty rhetoric. Sadly, the majority of people running for mayor are just pandering for votes.

[03:08 [SCRIE & DRIE: Selective rent-freeze policy that works]

Sticking with this theme, we wanted to take a moment to promote an actual way that some renters can freeze their rents. It's called the Senior Citizen Rent Increase Exemption or SCRIE. There is also the DRIE program for disabled people. 

The way this works is that the rent is frozen for eligible rent-stabilized tenants. The legal rents still go up and the difference is paid through a tax abatement to the owner. Since property taxes are by far the biggest cost for older rent-stabilized buildings, and one of the biggest reasons why so many of them are insolvent, this is a program that owners like. 

There are estimates by city agencies that as many as 50,000 renters are eligible for SCRIE or DRIE and are not taking advantage of it. So we're gonna be making a commitment to getting them signed up. We have spoken with several nonprofits that help do this type of work to see if there's a way to streamline this process. 

It's solutions like this that we need right now: people working together to actually help everyone. 

[04:07] [The Rent Guidelines Board is not the mayor’s plaything]

Getting back to the mayor's race now. In about eight days from when this podcast is released, we will know who the Democratic candidate for mayor will be. 

Early voting has started for the primary and election day is June 24th. 

At the final debate last week, there was an interesting exchange about the Rent Guidelines Board — specifically about whether or not the RGB is controlled by the mayor, or simply an independent board that has members who are appointed by the mayor.

Democratic Socialist Zohran Mamdani, who has pledged to freeze the rent for four years, says the mayor determines the rent adjustments. Andrew Cuomo, the current front runner in the race, said the mayor just picks the RGB members and they are to follow the law. Former Mayor Bill de Blasio then chimed in on social media to basically say he decided the rent change when he was mayor.

I've been clear on this point for the past nine months now, and the law is clear: The RGB is charged with looking at a lot of information and making an informed and independent decision. 

It's really a shame that former mayor Bill de Blasio has decided to chime in and suggest he was violating the law for eight years as mayor by acting like a king and telling an independent body what they should do. We hope the former mayor's comments were just him searching for relevancy at this point in his life and aren’t brazenly bragging about breaking the law. 

[05:30 [FARE Act takes effect]

Last week we saw the implementation of the FARE Act. This is the new law that changes how brokerage fees are assessed. 

It's already changed the market a little. The Real Deal reported that more than 10% of listings were pulled off of StreetEasy ahead of the deadline. Also, various outlets reported that rents immediately shot up a few percentage points. In Manhattan, that is about $300 or $400 in monthly rent. 

Ahead of the law there were talks of rent-stabilized units being pulled from public listings. That seems to be happening a little. Also, we are hearing that owners of rent-stabilized apartments are negotiating lower fees with brokers. 

We're gonna keep watching this closely, and I think it's fair to say that we're still months away from knowing exactly how the FARE Act will impact the rental market.

We should note that REBNY has appealed to the Second Circuit, challenging the dismissal of their legal challenge to the FARE Act. 

[06:19] [NYC to end the United Hold Incentive]

We're gonna end the podcast talking about a sad development: the decision to end the Unit Hold Incentive. 

This was a program offered by the Department of Social Services where they would pay one month's rent to a property owner if they held an apartment for a CityFHEPS voucher holder when they needed more time to finalize the paperwork.

The best way to describe this impact is to walk you through the rental process. It is illegal for a building owner to deny a voucher holder a rental, but a property owner has no legal requirement to hold an apartment for a voucher holder if they cannot move in on the agreed upon date. 

Typically, units are held for no more than 60 days. 

And typically it takes at least 60 days for the paperwork to get processed and get the voucher holder officially moved in. The one-month hold incentive was implemented to address this reality.

Ending this program is going to make it harder for voucher holders to find housing, period. It's also a warning that the city budget is being scaled back when it comes to funding the CityFHEPS voucher program. 

Considering the concerns over federal funding for vouchers at the city level, it couldn’t come at a worse time.

[OUTRO]

That's the podcast for this week. If you haven't voted yet, please make a plan to do so. These local elections are important. 

We hope you'll keep following us on X, Instagram and TikTok. You can find us @housingny. We love hearing comments from you. You can post 'em in the comment section of where you're listening to this podcast or engage on social media platforms.

You've been listening to the Housing New York podcast with Kenny Burgos, and I'll see you all next week. 

And remember, good housing policy starts with good conversation.