New Report: A Growth-Oriented Housing Plan for the Next Mayor

Eric Kober recommends a five-point plan to clear the way for new housing and bring down costs

NEW YORK, NY – New York City has a housing problem. Far too many New Yorkers pay far too much of their income in rent, yet many of these people would be able to afford better and cheaper housing if they lived almost anywhere else in the country. A 2018 report by the NYU Furman Center found that 53.9 percent of “low-income” renter households are what's known as "rent-burdened," paying more than 30 percent of income for rent. This supply crunch means the city cannot house the essential service workers on which its economy depends. Rather than work to address the root cause of high housing costs—restrictive regulations that strangle privately-funded housing construction—NYC’s leaders have attempted to solve the problem with unworkable mandates and lavish but nonetheless insufficient public subsidies. 

New York’s next mayor will likely have less to spend as the city labors under post-pandemic fiscal strain, and the new leader will need to develop a new approach, writes Eric Kober in a new Manhattan Institute (MI) report, A Housing Plan for NYC’s Next Mayor. Kober, a senior fellow at MI and veteran of the NYC Department of City Planning, has developed an alternative strategy to clear the way for new housing and finally reduce the city’s exorbitant costs.

Part of MI’s New York City: Reborn initiative, this report is the first installment in a series—A Policy Playbook for New York’s Next Mayor—to be released in early Spring. Kober’s five-point housing agenda represents a blueprint for the next mayor to move the city toward more available and affordable housing for all residents. Since the city is home to the nation’s densest neighborhoods, suburban-style communities, and everywhere in between, reforms will have to be tailored by neighborhood. Kober builds on an earlier set of zoning recommendations for post-pandemic recovery, in which he noted the potential of the city’s many low-rise commercial strips as sites for new housing and ground-floor retail, if the city would only lift the antiquated requirements for large amounts of unneeded but costly parking. New York City proper has been unable to match job growth with housing growth, issuing building permits for only 0.3 housing units for every net new job added. Kober discusses a broader range of available zoning reforms that should be implemented as appropriate:

• Permit accessory dwelling units (ADUs) in what are now single- or two-family homes.
• Encourage missing-middle housing.
• Rezone obsolete manufacturing-zoned areas for housing.
• Facilitate microunits.
• Allow residential buildings as large as office buildings.

Kober recommends further changes, such as a review of obsolete laws, codes, and procedural requirements (such as environmental reviews and prohibitions on shared housing) to boost the rate of new construction and remove additional supply constraints. As he observes, the benefits to a robust private housing market that meets the needs of low-, moderate-, and middle-income New Yorkers are manifold, allowing the city to target subsidies and achieve budget savings while making life better for the service-sector workers who form the backbone of the city’s economy.  He notes that some of the priority areas where the city will still need to target public resources are senior and supportive housing, rent supports for very low-income households, and returning the city’s public housing to a state of good repair. However, it won’t need to spend massive per-unit subsidies to produce a relatively small number of new units targeted to very poor households, as it does currently.

If New York City is to flourish after the pandemic, Kober writes, it will need to bring down housing costs. And if the city is to do that, it will need to become less reliant on massive public subsidies and more favorable to private development. Kober’s report is a much-needed discussion of the challenges the next mayor will face—and explains that the best way to solve those challenges is through new-housing growth.

About New York City: Reborn

New York City: Reborn is a Manhattan Institute project that encompasses research, journalism, and event programming. Through this initiative, the institute convenes business, civic, academic, and civil-society leaders from around the city with MI scholars to discuss issues key to the city’s recovery. Post-coronavirus, MI envisions a growing New York City with a thriving economy, healthy finances, accessible housing, effective infrastructure, flourishing education, safe streets, and increasing competitiveness. New York City: Reborn will help turn that vision into reality. Click here to learn more.

Click here to read the full report.