New construction in Manhattan real estate is stagnant, leading to a crisis situation, according to the borough president.
New construction in Manhattan real estate is stagnant, leading to a crisis situation, according to the borough president.
New York City’s Housing Crisis: A Race Against Time
Introduction
New York City’s housing crisis has reached critical proportions, with the construction of new housing units falling to a trickle. Despite the severe affordability crisis, the city has been unable to keep up with the growing demand for housing. Borough leaders are sounding the alarm, calling for urgent action to address the anemic pace of development. Let’s dive into the details of this crisis, the factors contributing to it, and the proposed solutions.
The Crisis Deepens
Last month, Manhattan, home to 1.7 million people, did not approve a single new unit of housing. In the other four boroughs combined, only 10 buildings with a total of 279 units were approved. This alarming trend has prompted Manhattan Borough President Mark Levine to declare a crisis. Levine highlighted the decreasing rate of construction, comparing the number of units approved in July 2013 to those approved in July 2022. The numbers tell a grim story: 2,525 citywide units and 1,208 in Manhattan were approved in July 2013, while July 2022 saw only 527 citywide and 215 in Manhattan.
- AI companies boost San Francisco’s real estate market.
- A supermarket used AI to suggest meal ideas for leftovers, includin...
- A trainee driving instructor crashed into the driving school where ...
Demand Outpaces Supply
New York City has been constructing far fewer housing units than needed in recent years, resulting in skyrocketing rent and home prices. Over the past decade, the city has gained about four times as many new residents as new homes. In 2019, the New York metro area required over 340,000 new homes. A recent report revealed that half of all working-age households in New York City cannot afford housing and other essential goods.
Proposed Solutions
To combat the housing crisis, Mark Levine has developed a housing plan that identifies approximately 200 sites in Manhattan suitable for constructing over 70,000 new homes. These sites include empty manufacturing spaces, abandoned bus depots, and unused Post Office buildings. However, restrictive zoning and building code regulations, along with the expiration of a key tax incentive for developers known as 421-a, have contributed to the sluggish residential construction in New York City.
City and State Efforts
City and state leaders have been actively pushing for more housing to address the affordability crisis. New York City Mayor Eric Adams aims to build 500,000 new homes by 2032, setting what he calls a “moonshot” goal. However, to meet current and future demand, the city needs 560,000 new homes by 2030.
Governor Kathy Hochul attempted to pass a housing reform package, the New York Housing Compact, to boost the housing supply in New York City and its suburbs by 3% over the next decade. The plan included the construction of 800,000 new units, primarily concentrated near transit stations. The legislation also sought to extend the 421-a tax break, which has been instrumental in stimulating housing development. Unfortunately, the effort failed due to opposition from Republican and centrist Democratic lawmakers, particularly from suburban areas around New York City that opposed increased density.
Executive Actions and Suburban Struggles
To combat the housing crisis, the governor’s office recently announced executive actions such as tax incentives for developers and the exploration of new housing on state-owned land. These measures aim to boost housing construction and provide some relief to the worsening situation.
It’s not just Manhattan that has been failing to address the shortage of housing. The suburbs surrounding New York City have also struggled to construct new housing units. For example, the town of Munsey Park in Nassau County, Long Island, approved merely four new single-family homes between 2010 and 2021. Similarly, the city of Rye in Westchester County only granted 77 new housing permits during the same period, with 65 of them for single-family homes.
However, not all suburbs are ignoring the housing shortage. Jersey City, New Jersey, is actively building a significant number of new housing units and even redeveloping aging affordable housing. Hudson County, the home of Jersey City, has been constructing new housing at twice the rate of New York City between 2010 and 2018.
Conclusion
New York City’s housing crisis is intensifying, with the construction of new housing failing to keep pace with the soaring demand. The affordability crisis has left half of the city’s working-age households unable to afford housing and essential goods. Borough leaders, along with city and state officials, have proposed various measures to tackle the crisis, but significant challenges, including restrictive regulations and political opposition, persist. Urgent action is needed to address the housing shortage and ensure that New York City remains a vibrant, inclusive, and affordable place to live.
