The board that determines rent increases for New York City's roughly one million rent-stabilized apartments voted on Wednesday to enact an unusual mid-year rent hike over the opposition of both tenant groups and landlords.
By a five to four margin, the Rent Guidelines Board voted to freeze rents on stabilized apartments for the first six months of one-year leases — beginning on October 1st — while allowing landlords to increase rent by 1.5% in the next six months. For two-year leases, landlords can increase rent by 2.5%, according to the mayoral-appointed panel.
Alex Schwartz, one of five members who represents the public on the board, framed the structure as a middle ground between tenants and landlords that are just now emerging from the worst of the pandemic. "This proposal is intended to provide additional time for economic recovery before any rent increase goes into effect," he said.
At a rally outside Cooper Union on Wednesday, Sheila Garcia, one of two board members representing tenants, said the six-month window would not give struggling tenants enough time to find work. Flanked by chanting tenants, she called for a full rent freeze on one-year leases, something the board has granted in three of the last seven years.
There are an estimated 2.3 million tenants in New York City living in stabilized apartments. According to a survey by the Community Service Society, 42% of rent regulated tenants said they lost income last year, and 38% reported having less than $1,000 in savings.
“There’s an assumption that tenants can afford to pay $10, $30 as the cost of landlords continuing to make profits,” Garcia said. “We haven’t seen the total effect of the rent relief program, the total effect on tenants of what the pandemic is doing."
The two members representing property owners, meanwhile, called for a significant rent hike — 2.75% for one year leases and 5.75% for two year leases. They cited growing property taxes and maintenance costs faced by landlords, and accused the de Blasio administration for favoring tenants over owners. "There is a ton of assistance available to renters who cannot pay," said Robert Ehrlich.
Both the tenant and landlord proposals were shot down by the board's five public members.
The vote comes as the state is poised to distribute $2.7 billion in federal rent relief to struggling tenants and landlords. In his closing remarks, board chair David Reiss, who backed the mid-year rent hike, said that the future of New York City's housing stock could depend on the success of the state's program.
"The economic consequences of the pandemic have severely impacted working New Yorkers," Reiss added. “There’s no fool-proof formula for a fair rent adjustment."