Affordable housing (photo: Michael Appleton/Mayoral Photography Office)
Rent increases begin for roughly one million rent-stabilized New York City apartments on October 1, the highest increases since 2013.
Fallout from the pandemic has strained landlords, especially owners of smaller multi-family rental buildings, and it has also dramatically impacted families who were already struggling to pay even below-market-rate rents.
At the “raucous” Rent Guidelines Board meeting about the increases, tenants advocated for rent freezes and rollbacks while landlords argued for higher increases.
Here is a strategy for our city to help both landlords and tenants: create opportunities for rent-stabilized New Yorkers to buy their buildings.
Converting existing rental buildings into shared equity homeownership opportunities will enable renters to experience the generational wealth, health, and educational benefits of home equity. Owners who are already thinking about selling will have an opportunity to do so in a way that delivers dollars and social impact, strengthening our city.
As I gathered with world leaders recently as a delegate to the Clinton Global Initiative, I was honored to introduce the Tenant Opportunity to Purchase Program (TOPP) as our “commitment to action.” TOPP will convert 350 rental apartments into permanently affordable homeownership opportunities on a community land trust, providing access to homeownership for future generations of low-income New Yorkers.
Through TOPP, tenants and multifamily building owners will access technical assistance, housing finance, and construction preservation expertise. It’s a win/win/win scenario that is scalable as a model for all like-minded, mission-driven businesses and organizations to transform tenants into owners.
Affordable homeownership is a uniquely powerful tool for creating more equitable communities. It creates community assets that protect families from displacement, immune to the vagaries of speculative investment.
It offers self-determination of where to live and how long to stay.
It fosters more civically-engaged residents, and, through rental-to-ownership conversions, provides opportunities to make energy efficiency improvements to mitigate climate change and reduce energy costs.
Perhaps most importantly, affordable homeownership creates infrastructure for equity, as an urgent response to centuries of racist housing laws and financing mechanisms that prevented communities of color from entering the homeownership market. This legacy continues to shape the geography of the wealth, health, and education inequality we see today in our city where 41% of white people own homes, while only 27% of Black people and 16% of Latino people do.
We estimate that roughly 95% of tenants who will become homeowners through TOPP will be Black or Latino New Yorkers in communities that have lengthy histories of disinvestment and redlining. With well-resourced investors buying potential starter homes as they hit the market and converting them to market-rate rentals—and with affordable housing construction focused almost exclusively on rental housing—now is the vital time to implement new homeownership strategies to close the racial homeownership gap.
By addressing housing affordability and equity through affordable homeownership conversions, we as a city can build a more equitable New York, addressing several of our most pressing social and economic challenges at once.
Karen Haycox is CEO of Habitat for Humanity New York City and Westchester County. On Twitter @HabitatNYC_WC.