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Average New Yorkers being priced out of Manhattan

5:12 pm, August 29, 2013

By Holly Dutton

After it was recently revealed that Extell’s luxury Upper West Side high-rise at 40 Riverside Boulevard has a separate backdoor entrance for its subsidized housing tenants, many people cried foul, including mayoral candidate and City Council Speaker Christine Quinn, who said in a letter to lawmakers that she “won’t stand for this or discrimination of any kind.”

With events like this highlighting the widening gap between the rich and poor in New York City, where does the middle class fit in?

Most new development in Manhattan is forcused on luxury development. Lavish living here extends to properties like One57 (above) where the penthouse was recently sold for more than $90 million.

The share of moderate and middle-income households who are paying more than the recommended maximum of 30 percent of their monthly income on housing has gone up dramatically from 2002 to 2011, according to NYU’s Furman Center for Real Estate and Urban Policy.

“The truth is, between 2002 and 2011, rents went up and incomes stayed stagnant, or in real dollars decreased,” said said Vicki Been, a professor at New York University School of Law and director of the Furman Center.

Just last month, a report from the real estate analyst firm REIS found that the average rent in New York City is upwards of $3,000 a month. Middle-class in New York City means earning between $45,000 and $134,000 per year, according to the New York Times, compared to between $33,000 and $100,000 in other parts of the country.

But most new development in Manhattan has focused on luxury residential buildings like One57 and 15 Central Park West, where asking prices are well into eight figures and price per square foot is upwards of $5,000.

With numbers like that, it’s no wonder middle-class New Yorkers are pushing further and further into neighborhoods in the outer boroughs, in burgeoning neighborhoods like Bushwick and Crown Heights in Brooklyn, two nabes that have seen incredible growth in recent years.

The Inclusionary Housing Program, which led to the segregated entrances at 40 Riverside Boulevard, was created by the Department of City Planning in 2005 to try to create more homes for middle- and working-class New Yorkers.

The program offers developers optional floor area bonus in exchange for setting aside up to 20 percent of the units in a residential building as affordable housing.

Since the program began, there have only been 2,800 units built, according to Business Insider. And the income requirements often take these apartments out of the reach of the middle class, who now find they make too much money to qualify.

For example, a new development at 525 West 28th Street in Chelsea that took part in the Department of City Planning’s Inclusionary Housing Program, currently lists 12 studio apartments available for $520 a month, with the requirement that the total income range is between $19,749 and $24,080.

A one-bedroom at the same building is listed as $712 a month with an income minimum of $26,400 and maximum of $30,100, if there is only one person living there. For two people, the minimum stays the same and the maximum total income is $34,400.

There is more affordable housing in the works. Forest City Ratner’s Atlantic Yards project in Downtown Brooklyn is slated to have 6,430 total units, 2,250 of which will be affordable housing.

The modular housing building The Stack, which broke ground last month at 4857 Broadway in Inwood, at the top of the island of Manhattan, will be 28 units of “moderate-income housing,” according to developer Jeffrey Brown and architects Gluck+.

Mayor Michael Bloomberg has been hailed for his legacy plan to build 165,000 affordable homes – the largest municipal affordable housing plan in the nation’s history.

However, in an analysis by the Association for Neighborhood and Housing Development (ANHD), whle the mayor has indeed kept to his promise, the units he built are often still too expensive for the neighborhoods in which they were built. Approximately one-third of them have an upper income limit above the actual New York City median income. And in half the City’s community districts, the majority are too expensive for a household earning the local median income for the neighborhood.

“The city’s commitment to, and execution of, its New Housing Marketplace Plan is commendable. It would have been easy to dial its ambition back during the recession, but instead the City decided to recommit to seeing it through,” said Moses Gates, co-author of the report.

“But a comprehensive affordable housing program needs to be about more than just number of ‘units built.’ It also needs to take into account the needs of local residents. If we’re going to invest in building affordable housing, what we build should be affordable to the people in the neighborhood.”

Benjamin Dulchin, executive director of ANHD, pointed to the Dempsey in West Harlem as an example of the city getting it right.
The Dempsey is a joint venture of two not-for-profit organizations; the locally-based West Harlem Group Assistance (WHGA), and Phipps Houses, a citywide non-profit housing developer and manager.

In addition to being affordable to people in the neighborhood (rents range from $461 for a studio to $1,087 for a three-bedroom apartment), the development brings an outdoor sitting area for residents, and replaced a dilapidated playground with a state-of-art, ADA compliant play area for local children at multi-service center next door.

“When you have developers who really know and are committed to the community, the City can facilitate some great projects that help build and stabilize neighborhoods,” said Benjamin Dulchin, Executive Director of ANHD.

Housing policy experts agree that while the New Housing Marketplace was an unprecedented achievement, the next administration has to take a further step, and start measuring progress in a more comprehensive way.

VICKI BEEN

“New York City Mayors have long understood the critical role that safe, decent and truly affordable housing plays in ensuring that New York City remains a global capital that attracts people from around the world to live in vibrant neighborhoods that offer opportunity to all” said Michelle de la Uz, Executive Director of Fifth Avenue Committee.

“The challenges for the next Mayor are clear — we must re-tool, re-double and re-align the city’s efforts to support permanent and real affordable housing, or risk becoming a city that only the very wealthy can afford.”

In the 2000s, before the economic crash, New York City had a “tremendous” amount of new construction and new residents were flowing into the city, Been said. However, because there was little construction in the 1990’s, the city was “working off a deficit.

“So we were kind of playing catch up in the 2000’s and we didn’t catch up enough to sort of close that gap,” she said.

The only solution, Been said, is for construction to happen even faster than people are moving to the city.

“We can keep building till the cows come home, but if we keep adding population we’re not getting ahead of the game,” she said.

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