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For many decades, the New York metropolitan area has suffered from an increasing shortage of housing, as housing supply has not met housing demand. As a result, New York City has the highest rents of any city in the United States. [1]
The New York metropolitan area has long-standing exclusionary zoning practices, which were frequently rooted in racism. Restrictive zoning regulations, which prohibited multifamily residential use and affordable housing, were intended to prevent non-whites from moving to white neighborhoods. [2] [3]
The housing shortage in New York is driven by a lack of housing supply. Home construction in New York City lags far behind other major American cities. [4] Since 2010, housing supply in New York City has increased by 4% while jobs have increased by 22%. [4] Restrictive zoning regulations are a key contributor to the undersupply of housing, as zoning laws either prohibit or disincentivize anything but single-family housing in much of the metropolitan area. [2] [3] [5]
In the 2020s, some New York politicians pushed for ambitious plans to increase housing supply in New York by undoing some of the most restrictive zoning regulations and permit mixed-use development in areas previously exclusively for commercial use, allow accessory dwelling units in single-family zones, and allow dense housing construction near public transit stations. [5] These plans faced considerable opposition by politicians from the New York suburbs, in particular, where zoning is most restrictive. [6] [5]
In the post-war era, New York, like most American cities, saw a sharp decline in population as “white flight,” highway construction, and old commuter railroads allowed families to decamp from cities into new suburbs outside the city limits. Consequently, from approximately 1950 to 2000, New York City’s total population sat below its previous all-time high. This exodus from the city allowed rents to remain relatively affordable through the immediate post-war era. [7]
However, in the late 20th century cultural changes increased demand for city life as individuals and families became increasingly likely to remain in cities, or at least delay moves to the suburbs. Jobs returned to downtown centers and demand for housing in New York boomed. [8]
To absorb this demand, New York produced 2.2 units per job from 2001 to 2008. However, from 2009 to 2018 the City built just 0.5 units per job as land use regulation, historical preservation, and political opposition ground housing production to a halt. [9]
Consequently, the cost of housing production has skyrocketed in New York. With little available land remaining for development, long approvals processes, and onerous building code provisions, costs to produce housing have markedly increased at every step of the process. As a result, developers are unable to provide moderately-priced housing as the costs imposed by the City and local opposition forces have made housing for the middle class prohibitively expensive to build. [10] In addition to development restrictions, there are barriers which inhibit repartitioning existing units to accommodate more people. New York City housing codes restrict the number of people who are legally allowed to occupy a unit, as well as the number of bedrooms within a unit. [11]
Moreover, New York’s public housing stock, a vital tool for reducing homelessness and maintaining the number of affordable units, has fallen into disrepair as government management failed the City’s low-income residents. [12]
With production costs and zoning laws limiting private production of housing, and incompetence and criminal mismanagement reducing the efficacy of public housing, New York is facing a chronic housing shortage that increases costs for all New Yorkers looking to rent or buy a new home. Groups like the Citizens Housing and Planning Council and Open New York advocate for a resolution of the housing shortage through zoning reforms that would increase the rate of housing production. [13] [14]
In 2016, Mayor Bill de Blasio promised an even more aggressive plan to build and preserve 200,000 housing units over ten-years and he introduced mandatory-inclusionary zoning requiring 30 percent of all new construction units to be affordable. The goals of the initiative, which was called Housing New York, were later increased to 300,000 affordable housing units by 2026. [15] By the end of his administration, in 2021, none of the goals of the program had been reached: although Mr. de Blasio claimed that he had succeeded in "fighting inequality".
Between 2000 and 2012, the median rent of an apartment increased 75 percent in New York City compared to 44 percent for the rest of the United States. The increase impacted the poor and working class most. There was a loss of 400,000 apartments renting for $1,000 a month or less (constant 2012 dollars) and a resulting gain of apartments renting over this. This was not a small shift but saw 240,000 units renting for $601–800 disappear and apartments renting for $1,201-1,600 having the highest gains. Median rent in constant dollars increased from $839 in 2000 to $1,100 in 2012. [16]
Partially offsetting the growth in housing units was an increase in population to 8.6 million people. All boroughs, including the Bronx, are close to all-time population highs as of 2018. Factors include an increase in employment to 4.5 million jobs and a trend of decreasing crime. [17]
Almost 1.5 million people live in overcrowded conditions in New York City. Overall crowding rose from 7.6 percent in 2005 to 8.8 percent in 2013 (a 15.8 percent increase). Overcrowding is not limited to low-income households, but is found at all income levels. [18]
The California Health and Human Services Agency defines "severe overcrowding" as more than 1.5 persons per room. [19] The severe overcrowding rate in the nation is 0.99 percent and is 3.33 percent in New York City. [18]
In 2018 there were 63,495 homeless in New York City, including over 23,600 children. Total homelessness in the city had increased by 82 percent over the last decade. [20] According to an agency funded by the New York State Education Department, there were 104,088 students (1 in 10) living in temporary shelters and identified as homeless in the city's school system for the period 2016-2017. [21] [22]
Homelessness is expensive for the city. Following a 1981 consent decree arising from Callahan v. Carey , the city is required by law to provide shelter to any eligible person who asks for it. To shelter one family in one of the 167 family shelters costs $34,573 a year. $1.04 billion was budgeted for 2014 to provide homeless services, up from $535.8 million in 2002. [16]
The city has had many periods of housing shortages in its history. Following a housing crisis in the 1920s, 700,000 units were built but in the 1930s people were again talking about a crisis. Mayors Fiorello H. La Guardia and William O'Dwyer dealt with slum clearance and building public housing. Rent control in New York, having begun as part of price controls on the United States home front during World War II, continued after the war. Robert F. Wagner Jr. and John Lindsay oversaw the Mitchell-Lama Housing Program. Ed Koch was mayor during a wave of housing abandonment which had to be addressed. This continued under David Dinkins and Rudy Giuliani. [16]
Homelessness of individuals and families became a major issue during the 1980s and 1990s. Mayor Bloomberg's term in office saw an economically resurgent city. During this period, rents in New York City rose more than 15 percent over the increase in the country as a whole. His New Housing Marketplace Plan pledged to create 165,000 units of affordable housing between 2002-2014, of which 53,000 would be new units and 112,000 preserved units. The cost for this program was $23.6 billion, of which $5.3 billion was public funds leveraging $18.3 billion in private funds. [16]
Inclusionary zoning (IZ), also known as inclusionary housing, refers to municipal and county planning ordinances that require or provide incentives when a given percentage of units in a new housing development be affordable by people with low to moderate incomes. The term inclusionary zoning indicates that these ordinances seek to counter exclusionary zoning practices, which exclude low-cost housing from a municipality through the zoning code. Non-profit affordable housing developers build 100% of their units as affordable, but need significant taxpayer subsidies for this model to work. Inclusionary zoning allows municipalities to have new affordable housing constructed without taxpayer subsidies. In order to encourage for-profit developers to build projects that include affordable units, cities often allow developers to build more total units than their zoning laws currently allow so that there will be enough profit generating market-rate units to offset the losses from the below market-rate units and still allow the project to be financially feasible. Inclusionary zoning can be mandatory or voluntary, though the great majority of units have been built as a result of mandatory programmes. There are variations among the set-aside requirements, affordability levels, and length of time the unit is deed-restricted as affordable housing.
The affordability of housing in the UK reflects the ability to rent or buy property. There are various ways to determine or estimate housing affordability. One commonly used metric is the median housing affordability ratio; this compares the median price paid for residential property to the median gross annual earnings for full-time workers. According to official government statistics, housing affordability worsened between 2020 and 2021, and since 1997 housing affordability has worsened overall, especially in London. The most affordable local authorities in 2021 were in the North West, Wales, Yorkshire and The Humber, West Midlands and North East.
Single-room occupancy (SRO) is a form of housing that is typically aimed at residents with low or minimal incomes, or single adults who like a minimalist lifestyle, who rent small, furnished single rooms with a bed, chair, and sometimes a small desk. SRO units are rented out as permanent residence and/or primary residence to individuals, within a multi-tenant building where tenants share a kitchen, toilets or bathrooms. SRO units range from 7 to 13 square metres. In some instances, contemporary units may have a small refrigerator, microwave, or sink.
The YIMBY movement is a pro-infrastructure development movement mostly focusing on public housing policy, real estate development, public transportation, and pedestrian safety in transportation planning, in contrast and in opposition to the NIMBY movement that generally opposes most forms of urban development in order to maintain the status quo. As a popular organized movement in the United States, it began in the San Francisco Bay Area in the 2010s amid a major housing affordability crisis and has subsequently become a potent political force in state and local politics across the United States.
Affordable housing is housing which is deemed affordable to those with a household income at or below the median as rated by the national government or a local government by a recognized housing affordability index. Most of the literature on affordable housing refers to mortgages and a number of forms that exist along a continuum – from emergency homeless shelters, to transitional housing, to non-market rental, to formal and informal rental, indigenous housing, and ending with affordable home ownership.
Rent regulation in New York is a means of limiting the amount of rent charged on dwellings. Rent control and rent stabilization are two programs used in parts of New York state. In addition to controlling rent, the system also prescribes rights and obligations for tenants and landlords.
Exclusionary zoning is the use of zoning ordinances to exclude certain types of land uses from a given community, especially to regulate racial and economic diversity. In the United States, exclusionary zoning ordinances are standard in almost all communities. Exclusionary zoning was introduced in the early 1900s, typically to prevent racial and ethnic minorities from moving into middle- and upper-class neighborhoods. Municipalities use zoning to limit the supply of available housing units, such as by prohibiting multi-family residential dwellings or setting minimum lot size requirements. These ordinances raise costs, making it less likely that lower-income groups will move in. Development fees for variance, a building permit, a certificate of occupancy, a filing (legal) cost, special permits and planned-unit development applications for new housing also raise prices to levels inaccessible for lower income people.
Rent regulation is a system of laws, administered by a court or a public authority, which aims to ensure the affordability of housing and tenancies on the rental market for dwellings. Generally, a system of rent regulation involves:
The affordable housing gap is a socio-economic phenomenon characterized by the scarcity of affordable housing relative to the demand for it. This disparity is linked to social, racial, and economic inequality, and disproportionately affects households with lower incomes. The insufficiency of suitable affordable housing options can lead to negative outcomes for both families and communities.
Housing in the United Kingdom represents the largest non-financial asset class in the UK; its overall net value passed the £5 trillion mark in 2014. Housing includes modern and traditional styles. About 30% of homes are owned outright by their occupants, and a further 40% are owner-occupied on a mortgage. About 18% are social housing of some kind, and the remaining 12% are privately rented.
Starting in the 1990s, the city of San Francisco, and the surrounding San Francisco Bay Area have faced a serious housing shortage, such that by October 2015, San Francisco had the highest rents of any major US city. San Francisco's onerous permitting and approval processes have given city the slowest permitting process of any large city in the United States, with the first stage taking an average of 450 calendar days, and the second stage taking 630 days for typical multi-family housing, or 860 days for a single-family house, and the second-most expensive construction costs in the world.
The United States Department of Housing and Urban Development estimated that more than 181,399 people were experiencing homelessness in California in January 2023. This represents more than 27% of the homeless population of the United States even though California has slightly less than 12% of the country's total population, and is one of the highest per capita rates in the nation, with 0.46% of residents being homeless. More than two-thirds of homeless people in California are unsheltered, which is the highest percentage of any state in the United States. 49% of the unsheltered homeless people in the United States live in California: about 123,423 people, which is eight times as many as the state with the second highest total. Even those who are sheltered are so insecurely, with 90% of homeless adults in California reporting that they spent at least one night unsheltered in the past six months.
The term housing crisis refers to acute failures in the housing market at a given place and time. Depending on the context and the speaker, the term has taken on substantially different meanings. A prominent current use, for example, refers to shortages of available housing in the United States and other countries, but it has also been used to describe financial crises related to the real estate sector.
Since about 1970, California has been experiencing an extended and increasing housing shortage, such that by 2018, California ranked 49th among the states of the U.S. in terms of housing units per resident. This shortage has been estimated to be 3-4 million housing units as of 2017. Experts say that California needs to double its current rate of housing production to keep up with expected population growth and prevent prices from further increasing, and needs to quadruple the current rate of housing production over the next seven years in order for prices and rents to decline.
California Senate Bill 35 is a statute streamlining housing construction in California counties and cities that fail to build enough housing to meet state mandated housing construction requirements. The bill was introduced to the California State Assembly by State Senator Scott Wiener (D-SF) on December 15, 2016. SB 35 aims to address the California housing shortage by increasing housing supply. The bill was signed into law on September 29, 2017 by Governor Jerry Brown as part of California’s 2017 Housing Package – a set of 15 bills that provide “an injection of new regulatory and financial resources” for cities.
In October 2023, an average of 90,578 people slept in New York City's homeless shelters each night. This included 23,103 single adults, 32,689 children, and 34,786 adults in families. The total number is at its highest ever, with 63,636 people sleeping in homeless shelters. The city reported that in 2019, 3,600 individuals experienced unsheltered homelessness, sleeping in public spaces such as streets and public transit rather than shelters. The homeless population has surged in New York City 18% in 2023 from 2022, despite efforts from Mayor Adams.
Housing in the United States comes in a variety of forms and tenures. The rate of homeownership in the United States, as measured by the fraction of units that are owner-occupied, was 64% as of 2017. This rate is less than the rates in other large countries such as China (90%), Russia (89%) Mexico (80%), or Brazil (73%).
Single-family zoning is a type of planning restriction applied to certain residential zones in the United States and Canada in order to restrict development to only allow single-family detached homes. It disallows townhomes, duplexes, and multifamily housing (apartments) from being built on any plot of land with this zoning designation.
Open New York (ONY) is a New York-based non-profit advocacy organization focused on addressing metropolitan New York's housing shortage by increasing the rate of housing production in the city and region. Part of the broader "YIMBY" (Yes In My Back Yard) movement, the group advocates for the lifting of exclusionary zoning restrictions and reforms to zoning regulations to enable more residential homebuilding in what it terms "high-opportunity" areas near job centers and transit with high incomes.
The term "affordable housing" refers to housing that is considered economically accessible for individuals and families whose household income falls at or below the Area Median Income (AMI), as evaluated by either national or local government authorities through an officially recognized housing affordability index. However, in the US, the term is mostly used to refer to housing units that are deed restricted to households considered Low-Income, Very Low-Income, and Extremely Low-Income. These units are most often constructed by non-profit "affordable housing developers" who use a combination of private money and government subsidies. For-profit developers, when building market-rate developments, may include some "affordable" units, if required as part of a city's inclusionary zoning mandate.