New York City mayoral candidates often make extravagant promises on affordable housing, and underproduce on results.
Back in 2013, for example, then-candidate Bill de Blasio banked on solving the city’s crisis of housing affordability with Mandatory Inclusionary Housing, a policy that required developers to build affordable housing if they benefited from zoning changes.
“I want to see much more aggressive policies in terms of how the city works with the real-estate industry,” de Blasio said.
Indeed, once elected, he and the City Council were as good as their word — so aggressive that, in the end, few affordable housing units were built under the program, and those were mostly heavily subsidized by the city.
De Blasio has, in fact, spent extravagantly on affordable housing. However, because of his indifference, if not hostility, to private-sector unsubsidized housing development, he didn’t succeed in boosting the net number of new housing units produced in the city, even in the extraordinary economic boom times that lasted into early 2020.
The city’s housing crisis persists, only temporarily ameliorated by recession. With strong economic growth forecast in 2021, the usual experience of too many households chasing after too few available housing units will likely happen again after the next mayor takes office in January of 2022.
The new mayor will need different and more effective housing policies. A new report as part of the Manhattan Institute’s Mayoral Playbook series looks at what those policies should be.
The report groups its policy recommendations into five large points.
- First, New York City needs to move aggressively on reform of its antiquated zoning resolution. For example, many low-rise commercial strips are good sites for new apartment buildings with ground-floor retail, if city government would only lift the obsolete requirements for large amounts of unneeded but costly parking.
In addition, a broader range of available zoning reforms should be implemented, including permitting accessory dwelling units (ADUs) in what are now single- or two-family homes; rezoning obsolete manufacturing-zoned areas; and allowing new residential buildings as large as office buildings.
- Second, a review of other outdated laws, codes and procedural requirements — such as environmental reviews and prohibitions on shared housing — could boost the rate of new construction.
- Third, city subsidies, which are likely to be more constrained due to falling tax revenues after the pandemic, should be targeted where they are most needed. These include housing for low-income seniors, supportive housing for the formerly homeless, and the renovation of rundown public-housing developments.
New York City’s priorities shouldn’t need to include the construction of heavily subsidized new housing for the very poorest households. If other reform policies are implemented, those households’ needs can be met with rent supplements in existing housing — a much less costly approach that is likely to receive federal support. - Fourth, NYC policies should be much more supportive of building unsubsidized housing for moderate- to middle-income households. De Blasio’s Mandatory Inclusionary Housing program included such an option, which worked in conjunction with tax benefits approved by the state legislature, but it has hardly been used due to opposition from the mayor and the council.
- Finally, the city needs to return its public housing safety net to a state of good repair, working with the Biden administration. This will work best if they take advantage of the development potential of the land the New York City Housing Authority controls in high-value neighborhoods.
These five components represent a shift in approach from the previous administration. The new approach would be more favorable to private
real-estate development and less reliant on massive public subsidies for new affordable housing.
Such a plan would question many of the well-meaning regulations that have been put in place over the years that, cumulatively, make new housing hard to build. Finally, it would preserve public housing while generating revenue from the system’s own valuable real estate.
In the coming months before the June 2021 Democratic primary for mayor, New Yorkers will hear different arguments from many candidates — including ones for more spending and more regulation of the private housing market. Citizens should ask how these can solve the chronic housing crisis when the very aggressive efforts by the de Blasio administration — at the height of an economic boom that made funding new and expanded housing programs relatively painless — could not.
Eric Kober is a senior fellow at the Manhattan Institute and author of the recent issue brief “A Growth-Oriented Housing Plan for the Next Mayor.”