As a rent freeze on New York City’s rent-stabilized apartments appears increasingly likely, some landlords are being thrown a bone by Mayor Zohran Mamdani’s administration.
Eligible owners will be permitted to make a one-time rent increase on certain vacant units, regardless of any rent freeze, the Wall Street Journal reported. The plan is expected to be revealed by the mayor on Tuesday.
The increases allowed would be decided on a case-by-case basis. The administration predicts hundreds of units could be eligible for the one-time hike, though it declined to project the size of possible rent increases.
“The reality is, they will all remain affordable,” said HPD commissioner Dina Levy.
It’s a small piece of the effort to prop up rent-stabilized landlords as a rent freeze seems inevitable.
At the beginning of the month, New York’s Rent Guidelines Board voted to raise rents in regulated apartments by a range starting with zero — meaning a freeze is very much on the table. The board approved increases of 0-2 percent on one-year leases and 0-4 percent on two-year leases starting in October.
Tenant advocates were unhappy with the preliminary vote after pushing for a negative range. Real estate groups also strongly decried the decision; the New York Apartment Association argued it guarantees building conditions will decline.
Real estate groups, including the NYAA, are exploring legal avenues to delay or stop the rent freeze. The likely target of any lawsuit is the structure and independence of the RGB, as landlord groups argue the board is taking directions from the mayor rather than making data-based decisions.
While a 2016 lawsuit challenging the board’s political independence failed, experts suggest that growing financial distress in the rent-stabilized sector could increase the likelihood of a new legal challenge succeeding.
As that’s considered, landlords are grasping at any potential lifeline to come out of the Mamdani administration. That includes tax exemptions and a $5 million loan program for landlords to deal with back rent. There’s also an insurance program geared towards slashing owners’ insurance costs by 20 to 30 percent.
All eyes will remain on the final RGB vote next month.
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