Affordable for Whom: How Robust is de Blasio's Housing Plan?

Now that pre-K is over, Mayor Bill de Blasio is homing in on housing. “Nothing more clearly expresses the inequality gap, the opportunity gap, than the soaring cost of housing,” the mayor said in his second State of the City speech. He promised again to build or “preserve” 200,000 affordable housing units over a decade. There’s nothing wrong with the mayor’s sentiment, and his housing plan is probably harmless enough. But he’ll never fix the housing “crisis.”

New York has a lot of people—and a lot of housing.

As of 2011, the city had nearly 3.4 million homes, according to a survey the federal government does for the city every three years. Of the 8.3 million or so people who live in those homes, 5.4 million are renters.

And for the most part, these renters are not rich. The median income of people living in rental apartments was $38,500. Even in apartments not subject to rent regulation, the median income of renters was $52,260—higher, yes, but well within New York’s middle class.

By definition, New York is an affordable-housing success story—millions of people who are not millionaires or even thousand-aires are already affording to live here. People who have rent-regulated apartments are paying, on average, $1,160 a month. People who pay “market” rent, often in two- and three-family buildings in the outer boroughs, are paying an average of $1,510.

And contrary to popular belief, you don’t have to have lived here decades and decades to have a decent rent.

Of the 67,818 apartments that were vacant and for rent in 2011, 84 percent—or 57,256—were going for rents between $1,000 and $1,500 a month.

Even “luxury” rental buildings that charge $3,500 for one-bedrooms aren’t aiming at the super-rich. Their tenants earn in the low six figures, hardly in the stratosphere.

On the other end, the 403,120 people who live in public housing make on average $23,150—and pay an average of $445 in rent.

So what, exactly, is the problem?

A big part of it is obvious: you get less square feet in New York than you do elsewhere in the county—and yes, it’s expensive compared to anywhere else. Our housing is crowded. The kitchens and bathrooms are old.

But let’s not forget: by definition—because they are here—New Yorkers of all income levels are choosing to live in crowded, dirty, old, expensive apartments. People come here and plunk down a good deal of their money on rent here because they have chosen to live here over Iowa and Indonesia, Virginia and Mexico.

They are going to keep doing this—and keep our housing prices high.

Another problem is definition—exactly who is de Blasio’s “affordable” housing for?

It’s not really for poorer people. Only 20 percent of de Blasio’s new or “preserved” housing—40,000 apartments—will go toward people making below $41,950 for a family of four.

Creating 40,000 “affordable” housing units for poorer people won’t do much harm, and, yes, it will help 40,000 poorer families. But it is no different than simply taking 40,000 poorer families of the more than one million New York families that would qualify and awarding them, say, $500,000 each in taxpayer money.

To act as if this somehow solves a systemic problem is to act under a delusion.

Sure, we could also double our public-housing supply—and another 400,000 poor people would soon fill the new towers.

But we’d also be asking everyone else—including other poor people—to subsidize it forever, as we do with existing public housing.

The rest of de Blasio’s new and “preserved” housing is, well, for almost everyone else in New York—people making from the low six figures up to the city’s middle income limit of $138,435.

Here, too, all the city is doing is taking a few lucky people and bestowing them with apartments with new kitchens and bathrooms. This is nice, but it’s not a systemic policy.

What should the city do instead?

Simple. Use tax policy to encourage as much rental-housing construction as possible, all over the city—and make sure we have the transit to support it. If people don’t want new housing in their neighborhoods, that’s fine, but then they can never complain about their rent—or their kids’ rent—again.

In the meantime, we can all hope we’ll be among the lucky winners.

Nicole Gelinas (@nicolegelinas on Twitter) is a contributing editor to the Manhattan Institute’s City Journal.