Albany close to landmark pact to boost NYC housing stock, curb rents: sources

Nobody’s happy about housing!

A reliable sign that a landmark housing package is inching closer to reality is that many stakeholders are crying out in a last minute push to get their priorities including in a final plan to grow the number of Big Apple homes and apartments.

Negotiators have come to preliminary agreements on many significant components of a complex multifaceted plan to build new housing, signaling that a deal may be within reach.

Exclusive Post reporting revealed that Gov. Kathy Hochul and leaders in the state Senate and Assembly are in general agreement to include key parts of the progressive “Good Cause Eviction” bill.

The legislation, championed by Democratic Socialists of America state Sen. Julia Salazar (D-Brooklyn) would effectively bar landlords from raising rents above a certain level and make it easier for tenants to challenge evictions in court.

While a number of lawmakers, including Salazar, tell the Post they’re comfortable, stakeholders both in-favor and opposed to Good Cause continue to raise the alarm.

“Some elected officials are more interested in scoring ideological points with extremists than with adopting practical and responsible solutions,” a spokesperson for Homeowners for an Affordable New York, a coalition opposed to Good Cause that includes small landlords wrote in a statement to the Post.

“Let’s be clear: Good-cause eviction would be a disaster for New York State and is unacceptable in any form. It would negate any efforts to increase the housing supply and only worsen the housing shortage,” the spokesperson continued.

Activists from Housing Justice for All, the progressive group most loudly calling for Good Cause, loudly paraded through the capitol Tuesday morning calling on the legislature and Governor to reject the compromise, which they called ​​”a disaster and an embarrassment.”

Nine of the activists got themselves arrested by blocking one of the entrances to Hochul’s offices on the capitol’s second floor.

The multi-pronged deal taking shape, if enacted, aims to boost housing construction in New York City and make that more palatable to lefty and liberal lawmakers — many of whom have histories of opposing new development — by pairing it with an overhaul and expansion of how rents are set across the city, according to over a half-dozen sources.

Supply-increasing provisions currently on the table as part of the package include:

•  Reviving a subsidy for affordable housing in new apartment towers that offers developers a property tax exemption for setting aside units for working and middle income households.

•  Lifting decades-old state regulations on density that barred construction of buildings like those along Central Park while allowing the construction of ‘pencil’ towers, depriving the city of potentially 20,000 apartments per decade;.

•  Speeding conversions of empty office towers into housing, potentially giving Lower Manhattan and Midtown badly needed boosts following the pandemic.

Those boosts would come with substantial changes to how rents are set in New York City, which are the subject of much of the ongoing negotiations. 

Lefties and progressives have pushed for years for legislation like Good Cause that would grant tenants who pay their rent the right to automatic lease renewals and allow them to appeal large rent hikes in housing court if they can’t pay. 

Hochul and landlords have cracked the door open to such an arrangement — but the cap would likely be well above the level of inflation and by a formula that would be independent of the city’s Rent Board.

The deal currently on the table, per Post reporting, would cap rents at 5% plus the Consumer Price Index, a measure of inflation. Landlords could theoretically raise it higher, but tenants would then be able to drag them through lengthy court processes where they’d have to justify the increase.

“I want to make sure that people are not abusing our tenants, focus on anti-gouging and what is reasonable for them to have to endure,” Hochul told reporters last week.

Additionally, new construction would likely be carved out from the expansion.

In exchange, landlords may be able to pass on a greater share of the cost for building and unit upgrades to tenants covered by rent stabilization laws, which allow the Rent Board to set rents in many apartments built before 1977.  

State Senate Leader Andrea Stewart Cousins (D-Westchester) confirmed to reporters Tuesday that a housing deal would include changes to these upgrades under the Individual Apartment Improvements provisions of rent stabilization legislation passed in 2019.

There may also be provisions that include a pathway to upgrade and legalize basement apartments in New York. 

Those provisions could help expand housing production in New York from its pre-pandemic levels of approximately 200,000 units per decade to 250,000 units of housing, various projections from officials and reports that were compiled by The Post show. 

City Hall is pushing a separate package of legislation that would loosen local zoning requirements — dubbed “City of Yes” — that includes doing away with rules that mandate developers include parking garages with new buildings, which could generate another 60,000-70,000 units of housing per decade, officials say. 

A study by the Rand Corporation showed that New York needed to build roughly 350,000 units of housing over the last decade to keep up with demand — a target the city missed by an estimated 150,000 units. 

If all these changes were enacted that gap would be cut by more than two-thirds down to about 30,000-40,000 units.