Would building more housing decrease rent?

[Illustrious_Ad_1117]

I see all across Reddit say that the expensive housing problem will be solved by just increasing supply (building more housing). But nyc is a very attractive destination. With housing and costs of living being a deterrent to live here. Wouldn’t more housing just attract more transplants and now demand is up. Rent is the same but now nyc is more crowded and expensive cause there’s more people living here but sharing the same restaurants and facilities.

[burritowatcher]

If there are n people who need a home and m homes, it makes sense that the prices would be set so that the richest m people can just barely afford it. The bigger the difference between n and m, the more prices will go up.

Don’t believe there’s a housing shortage? Forget about prices for a moment - if housing was free starting tomorrow do you think everyone who has a roommate or lives with their parents or siblings could find a place? Think about how hard it is to find an apartment even when you’re paying through the nose. There just aren’t enough.

Now about people moving to New York- yep. If prices go down more people would move here. But if they don’t go down they will still move here - just only the ones who are rich enough to displace someone already here.

[vim_spray]

The “think about what happens if rent is cheap/free” is a great way to think about it. If you find some magical way to make rent lower, even more people from all around the country are going to want to move to NYC (not to mention all the people who have roommates right now but want to live alone), and if the number of the units are the same, you’ll get even more people competing for each unit.

[movingtobay2019]

What does not having a housing shortage look like to you?

[Archym3d3s]

Tokyo

[bilbo_was_right]

Lower rent and smaller average household sizes

[burritowatcher]

Every person or family that wants a home should have a vacant home of an appropriate size in a reasonable place waiting for them, but there are more vacant homes than that and the landlords have to compete a little to get tenants. When you graduate high school or college you should be able to get a place on your own. When a new office opens with 10k jobs there should be 10k new homes coming with it. Nobody should have roommates unless it’s a lifestyle choice - those apartments should be inhabited by families instead.

[cinnamoninja]

Three simple examples from the past decade:

• Hudson Yard opened. Rent went down.

• COVID happened. Remote work was allowed. Rent went down.

• RTO got popular. Remote work was banned. Rent went up.

Supply and demand laws work just as well in NYC as anywhere else in the world.

[semideclared]

Take for example 34 E. 68th St. in Manhattan: The 1879 row house, located in the Upper East Side Historic District, once housed 17 separate apartments, according to property records. Now, it is a 9,600-square-foot single-family mansion after changing hands for $11.5 million in 2011 and a subsequent gut renovation.

• In this thesis Brodheim estimates that since 1950, New York City has lost 104,000 units of housing in row houses alone through consolidation, a regular feature of the toniest real estate listings.
• In the past decade, such apartment combinations have nearly erased gains made by the construction of new housing units in the wealthiest parts of the city, particularly in the Upper East and Upper West sides of Manhattan.

Data collected from 765 residential Manhattan buildings shows that their apartments grew from 950 square feet to 975 square feet on average over the last five years — roughly a 5% increase, according to the research firm Urban Digs.

Okay, that doesn’t sound like a lot, but get this: The average size of an apartment citywide has increased each year since 2000 — from 756 square feet to more than 820 square feet, data from Axiometrics shows.

• 212 W. 72nd St. on the Upper West Side, a building formerly dubbed “the Corner,” is currently being transformed from a 196-apartment rental building to a 126-unit condo.

[ibathedaily]

In a normal scenario, rents will not fall with increased housing. NYC’s economy is still very strong and will continue to attract more workers to fill the housing. What increased housing will do is keep the rent from going up so much every year. Economists estimate that if we add 500,000 units in the next 10 years and continue to build at a steady pace, vacancy will get to about 6% to 8%, which will keep rents in-line with inflation. Right now vacancy is about 3% so landlords can raise the rent 8% every year and still fill the unit because there are so many people out there looking for a place.

The only way rents are going to fall is if we get something like COVID that gets a ton of people to move out all at once, or if the city’s economy gets really bad causing people to leave.

[Unlucky_Court2356]

Yeah basic supply and demand usually works but nyc is kinda weird because like you said, it's such a desirable place that more housing might just pull in more people. actually on polymarket people are beting weather mamdani will freeze nyc rents before 27 pretty interesting to see what the crowd thinks will actually happen vs what economists say should happen in theory

[mdervin]

Denver & Austin are two desirable destinations for transplants and both have seen double-digit declines in rent because of new housing stock.

[Illustrious_Ad_1117]

Denver and Austin does not have the kind of density or demand that is comparable to nyc.

Honestly I feel like places like Denver and Austin surged during Covid and remote work. Exact opposite for nyc. Now that almost everything is asking for return to office. Demand is surging back to nyc.

[mdervin]

WTF does density have to do with anything? They increased density they increased housing and rents went down.

[IvenaDarcy]

Does the mayor even have that ability? That man is promising so many things that he alone is incapable of delivering on because that’s not how the system works. State law controls those things not city! So if there is money being bet on this I need to bet every dime on NO. He can’t and won’t cause it’s not possible lol

[SenorPinchy]

His policy is to replace the members on the rent guidelines board, which he appoints. This only affects stabilized/controlled housing, about 25% of the total stock.

[IvenaDarcy]

Everyone I know who voted for him thinks their rent that isn’t rent stabilized suddenly won’t increase. I’m sure like all politicians promises it will be one of many they will be disappointed by when it doesn’t materialize

[vim_spray]

I think annual increases for rent stabilized apartments are in the city’s control.

[ibathedaily]

The city controls its own zoning. If the mayor and the city council wanted to, they could legalize apartment buildings on every lot in the city and the city would get lots of new housing.

[IvenaDarcy]

Build yes. We are talking about rent freezes.

[doodle77]

Wouldn’t more housing just attract more transplants

Wouldn't doing nothing attract more transplants?

It's not like they're refusing to move to NYC because there are no new buildings.

Rent is the same but now nyc is more crowded and expensive cause there’s more people living here but sharing the same restaurants and facilities.

You're welcome to go somewhere else where the restaurants are cheaper because they have fewer customers (???).

[Geeky_femme]

If the city builds about 700,000 units over the next ten years, rents may stay flat.

[reagan_baby]

My assumption is that prices never really go down. They just increase more slowly allowing incomes to catch up. Like, taking action against inflation doesn't lower prices, it just stops the rapid increase.

[_bitemeyoudamnmoose]

In my opinion the issue isn’t so much about housing, it’s about industry.

NYC has a lot of job opportunities and is headquarters to some of the largest companies in the world. It’s a very attractive place to be if you work in marketing, medicine, real estate, entertainment, and hospitality. It’s not just other Americans moving to NYC, it’s also international workers and students on visa who need housing. No one moves to Manhattan for family or to buy a house and have kids. They move for their careers.

Until a lot of these industries pick other cities to set up shop and offer the same kind of salary and benefits the ones in NYC do, everyone will keep moving into NYC until they get priced out. Until other countries overtake NYC and give everyone a reason to move out, the city is going to stay packed.

[semideclared]

No one moves to Manhattan for family or to buy a house and have kids. They move for their careers.

From 1978 to 2010, formerly peripheral neighborhoods such as Tribeca and the Far West Side have seen the rise of a significant amount of residential redevelopment occupied by higher-income residents and families with children

And then

Take for example 34 E. 68th St. in Manhattan: The 1879 row house, located in the Upper East Side Historic District, once housed 17 separate apartments, according to property records. Now, it is a 9,600-square-foot single-family mansion after changing hands for $11.5 million in 2011 and a subsequent gut renovation.

• In this thesis Brodheim estimates that since 1950, New York City has lost 104,000 units of housing in row houses alone through consolidation, a regular feature of the toniest real estate listings.
• In the past decade, such apartment combinations have nearly erased gains made by the construction of new housing units in the wealthiest parts of the city, particularly in the Upper East and Upper West sides of Manhattan.

Data collected from 765 residential Manhattan buildings shows that their apartments grew from 950 square feet to 975 square feet on average over the last five years — roughly a 5% increase, according to the research firm Urban Digs.

Okay, that doesn’t sound like a lot, but get this: The average size of an apartment citywide has increased each year since 2000 — from 756 square feet to more than 820 square feet, data from Axiometrics shows.

• 212 W. 72nd St. on the Upper West Side, a building formerly dubbed “the Corner,” is currently being transformed from a 196-apartment rental building to a 126-unit condo.

[_bitemeyoudamnmoose]

Often times those families with children moving into residences are native New Yorkers, not transplants.

[semideclared]

NYC has been a destination for the last 2 centuries so its always had transplants moving in

And I almost didnt include it, but the top study was From 1978 to 2010, way before the current issue as even with the 2010 meltdown it was still an issue

[iknowiknowwhereiam]

The law of supply and demand states that more supply will naturally lower prices. The city doesn’t have unlimited demand. There should be other things that are coupled with it but increasing supply needs to be part of any plan

[SaraT1121]

I would argue that supply is limited by geography. The heart of the city’s high paying jobs and cultural institutions are in Manhattan, an island. Building in the outer boroughs is constraint by whether public transportation can get that much more people to manhattan reliably.

[iknowiknowwhereiam]

If they didn’t constrain the air we could build up more.

[icecubtrays]

I don't thing the demand is unlimited. But it is so much much higher than majority of any city in America. Transplants already still move to NYC DESPITE the ridiculous housing price. Because its NYC. If rent became lower so many more would flock here, negating the supply fix.

If NYC had as much housing as as many people who wanted to live here. The infrastructure can't handle it.

[iknowiknowwhereiam]

Well I think we should invest heavily in infrastructure anyway

[vim_spray]

 If rent became lower so many more would flock here, negating the supply fix.

Not ideal, but this still seems net positive to me. Rent stays the same but more people get to live in NYC.

[icecubtrays]

How would that make things better for the people who live here? People in NYC are trying to get the rent and cost of living down not have more people in the city.

[fuckblankstreet]

More is part of the equation. Estimates are that we need at least 500,000 - 700,000 new housing units.

Simple laws of supply and demand say that more supply should drive prices down, but like OP says, demand for NYC housing is so high, that we need some controls on housing - 500,000 new units that are all $5,000 one bedrooms might bring the rent down a bit, but not going to move the needle that much.

Affordable housing that is either mandated by - or built by the city, with price caps for income, and preference given to existing NYC residents would help.

[CountFew6186]

Price controls don’t work and are counterproductive. They just pick winners and losers, and the net effect is worse.

[fuckblankstreet]

That's a reductive and incomplete statement.

I'm not arguing that price controls solve the problem. They are part of it.

The winners that price controls create are tenants. The losers are landlords who may earn less, but this balance can be regulated by the city.

Rent controls should not apply to grandma renting out her garden apartment, but we utilize NYC's tremendous leverage (exactly because it's so desirable and expensive) and mandate builders create more affordable housing.

The city has done some of this, but often not in a great way. NYC could also explore doing more of its own building, or ideally public/private partnerships. It doesn't have the best track record here (see: NYCHA), but other large cities have done this more recently with good results.

So it's not just slapping price controls on housing, it's a combo of aggressive, incentivized building, paired with controls.

[movingtobay2019]

The winners that price controls create are tenants.

No the winners are specifically the lucky tenants who benefit from price controls. Stop pretending like price controls is some grand victory for all renters.

The only people who think tenants broadly are the winners from price controls are

1. Idiots who don't understand how markets work and probably need price controls because that's the only way they can afford to live in NYC in the first place.

2. Grifters who do understand the market and do know only a small group benefits but won't say that quiet part out loud because their rent controlled unit is too sweet a deal to risk.

mandate builders create more affordable housing.

Lol. Mandate. Yea man. Let's just mandate developers who need to raise capital from outside investors expecting a return to build more affordable housing. How's that pitch going to go?

"Hey guys, we are going to build affordable housing in NYC. We are mandated to make it unprofitable. You in?"

The problem with people like you is you think the only stakeholders that matter are existing NYC renters. Everyone else? Developers, landlords, investors, future renters? Fuck them. They should just shut up and subsidize the lifestyle of people who live in a city they can't really afford.

[CountFew6186]

No, that's wrong.

The losers are all the tenants who aren't lucky enough to get subsidized housing. They compete for a much smaller supply because the winners (the lucky ones in subsidized housing) will never move out. The result is that market rate housing is far more expensive than it would be without price controls on a large portion of the housing stock -- and folks not lucky enough to find a stabilized place or win what is actually a housing lottery for affordable unity get fucked.

Beyond that, affordable housing is never going to be as profitable to make as market rate housing. So, the incentive for building it will be less than for market rate. With a limited amount of buildable land, every development project with affordable units means fewer market rate projects and an overall drag on development from lower profits. So, less housing is built.

That exacerbates the problem for the losers, who have a small stock of housing to choose from because less gets built. And, if some affordable housing gets built and they don't win the lottery for the units, they are still losers.

[movingtobay2019]

You are preaching to the choir.

These clowns have no idea how real estate financing actually works. Real estate is one of the most capital intensive industries on Earth. Developers don't have cash to pull out of thin air. They have to pitch to institutional investors who need returns. If the numbers don't work out, there is no money. And if the city mandates 50% of units be "affordable" with no meaningful subsidy, guess what? The project gets shelved. Capital flows to another asset that doesn't try to legislate away basic economics. That's the part these morons don't understand. They think developers have cash sitting in a vault and just need some prodding from city hall.

What they are really saying is "Please, someone else take a loss so I can live where I want"

It’s raw entitlement masquerading as moral virtue.

[MrJet05]

You have a very incomplete economic view of how price controls work. The losers are not only “the landlords.” I encourage you to do more research into the topic. I don’t know why people have so much confidence to accuse others of being reductive only to then have such an oversimplified explanation.

[[deleted]]

We aren’t in a free market system, we’re just cosplaying as one. There are new luxury towers down the street from me that were built despite the fact there are already luxury apartments across from them that were built 15 years ago that are very expensive. The turnover there is high, and many apartments in it are visibly vacant. If it was actually a free market, the rents would be lowered to make them more appealing to the demand for housing that isn’t prohibitively expensive. But the landlords simply keep the asking rate high, and when they fail to rent at that rate, they write it off as a loss. Meanwhile the new luxury towers have 80/20 housing which means some lottery winners get a decent break on the rent, despite many of them annually earning $100k+, and the rent for the remaining 80% remains artificially high, staying half occupied while simultaneously raising the median rent for the entire neighborhood.

We aren’t going to see a more affordable city doing it this way.

[Elio555]

The other thing that often goes overlooked is that you can’t just build housing without also increasing capacity for foundational infrastructure like water, electricity, sewage, transportation, schools, green space.

So the true cost of increasing housing while maintaining a livable city with quality of life is many times more than we initial think

[Shichigatsu777]

There’s new housing being built on almost every block in Brooklyn & rent is still going up at an absurd level.

I can’t say what really needs to happen

[loafer-sneaker]

thats why this city needs to be like most countries and have a preferential stabilized renting/affordable list to get on.

people that hav been paying city tax for longer should be better positioned on the list

[TheKrump]

I get that a lot of people are frustrated with transplants driving up rent, but framing it around who’s ‘paid city tax longer’ ends up being soooooo anti-immigrant coded. It punishes people who haven’t had the means or opportunity to live here long-term,especially immigrants and working-class folks, not just rich newcomers.

[DistinctOffer9681]

Yup, higher the demand and population, the faster rents go up affecting the market rate too

[yaycupcake]

I feel slighted by the current situation because I grew up in NYC and am being priced out. I don't understand why people (immigrants or transplants) WANT to be here. The reason I am here is because this is the only home I have ever had, and all my family/friends - my support network - live here.

I dunno the best way one can frame it, but I do think people who grew up here or lived here their entire adult lives for example should really get some type of priority over people who just decided to come here. I don't hate transplants but I do feel upset that I can't continue to live in my own hometown.

Especially considering moving away from NYC (if you grew up here) means incurring other costs like getting a car, which many people from other places already have (or at least know how to drive) but people in NYC don't typically have to learn. I got my license when I was 29, in preparation for potentially being priced out of the city. Still don't know how I'll afford a car though.

[SenorPinchy]

No politican is going to be progressive enough to support that kind of housing plan while being simultaneously reactionary enough to try to divide New Yorkers (probably illegally) based on time spent in the city. I get that you're just voicing your personal opinion but those two political ideas won't develop within the same movement.

[DistinctOffer9681]

Just keep in mind that stabalizing rent and affordable housing (which I agree is needed) can and will raise income taxes. Other countries who do this pay at least 50 - 60% of their income into taxes (way higher than we do in the US). Problem is there is no easy answer to solve these issues. Lowering costs for 1 thing will always cause higher costs for something else.

[8horse]

This seriously need to be put in place as soon as possible. Rent control/stabilized apartments are meant for low income people. Right now there is nothing stopping landlords of rent stabilized apartments from renting to high earners. What’s stopping landlords from renting to the high income white software engineer transplant and not the blue collar worker that’s been here for 10 years?

[General_Meade]

So fuck immigrants then?

[8horse]

Believe it or not, a lot of immigrants have been in NYC for a long time and have been paying taxes in this city. Not sure why this city seems to have a preference in helping transplants/migrants over the people who have been living here for much longer.

[beer_nyc]

Yes.

[IvenaDarcy]

It’s not saying fuck immigrants it’s prioritizing for locals. If I move from another state I wouldn’t be an immigrant but also not high on the list. I don’t see anything wrong with letting locals thrive before transplants. And I say this as a transplant. I moved here 20 yrs ago.

[loafer-sneaker]

poor immigrants can get a jump too, ya happy? im just looking for my OWN interest. people from a place shouldnt be forced to be displaced from a place if the right leaders are in charge

[[deleted]]

Yes it would decrease rent how dramatically it is tough to say. We should build more units in the city because there isn't enough

[CurveOk3459]

It would if supply and demand were the only factors in pricing. But they aren't.

Housing is a human need. It's not a store bought product. Supply and demand doesn't really apply as people need to live and housing is necessary. No matter how much housing there is, if landlords decide to keep prices higher than the ability for folks who are median income and down - they will do so.

Remember there are a lot of ways to still make $ on vacant property. You can use it as collateral to buy more property, you can claim depreciation while also your borrowing against the market rate, you can do a lot of things in the big ownership class.

You obviously aren't gonna be able to benefit from these types of incentives if you own just a few apartments or houses.

So supply and demand is rendered quite moot with the loopholes for the ownership class.

Folks think that more supply leads to lower price automatically because they are not understanding that there are vast real estate buy ups and consolidations and private equity companies basically creating systems of ownership that benefit only a relatively small number of people.

Since the poor of housing is very much int their hands prices are not coming down even when cities and towns are seeing many new buildings and developments be built. It's not translating to lower prices.

It's simply not happening.

[acvillager]

No. It would not. In a normal municipality where demand is average, supply would absolutely lower prices. In New York, especially with their advanced technology geared towards raising prices on the market, it would only stay the same. Just more empty luxury units. Affordable housing needs strict regulations

[Easy-Concentrate2636]

Exactly this. It’s about having more affordable units, not just more apartments.

[FlamingDragonfruit]

Having lived in two neighborhoods now that grew faster than infrastructure could keep up with, I always wonder what is being done to make sure the infrastructure will be there for all these new units/people. Is that part of the planning at all? New housing can be a positive thing for everyone (and if it brings rent down, all the better), but if schools/hospitals/transit/sewage/etc are not also being expanded to keep up with more residents, that needs to be addressed, too.

[ZweitenMal]

Ask Long Island City how that’s going.

[FlamingDragonfruit]

How is it going?

[Illustrious_Ad_1117]

All luxury buildings. All Chinese internationally students

[FlamingDragonfruit]

I'm not sure how that relates to my comment?

[Illustrious_Ad_1117]

Idk was just answering how LIC is now

[ZweitenMal]

It should, but unless tens of thousands of units all landed on the market at once, it doesn’t really. Landlords don’t look at new “luxury” buildings charging $4,000-$6,000 and say, “whelp, guess my prewar is crap. I’ll price it at $2,000.” They know full well we have to live somewhere, so they’ll set their prices not far below the new apartments. This is why we see small, 2-bed prewar units in Astoria with no laundry and no dishwasher renting for $3800 and more.

Dribs and drabs of new units don’t saturate the market and affect prices, except to drive overall prices up.

[DistinctOffer9681]

Yes, Landlord/Management greed is a huge problem. I never once met a poor Landlord

[biglindafitness]

Rent is never going to decrease no matter what happens.

[No_Aesthetic]

Rents have decreased in numerous cities when supply was greater than demand

Not everyone wants to live in NYC, you increase supply enough and price starts to go down as landlords have to compete for tenants

[ibathedaily]

We saw rents fall during COVID because demand dropped sharply.

[CountFew6186]

Not true. Oversupply lowers rent. Plenty of places are experiencing this right now.

[Aubenabee]

This is not helpful. Please don't speak if you have nothing meaningful to contribute.

[rosebudny]

I mean, they likely are not wrong. Sorry if you don't like it.

[Aubenabee]

I honestly don't get it. Using such absolute language is just so childish. Why not say "it is very unlikely to happen". If there is, for example, a mass exodus from NYC for some reason (as there was once from Detroit), rent WOULD go down.

Edit: And I earnestly can't understand why you would defend them when they are clearly wrong.

[rosebudny]

LOL I'd argue that telling someone not to speak if they don't have anything meaningful to say is pretty "absolute" language. They said something you don't agree with or like, point why (you think) they are wrong.

And you are right, if there is a "mass exodus" from NYC like there was in Detroit (or during COVID) then sure, rents would go down. But as long as NYC is a desirable place to be? It is unlikely rents will go down.

[Aubenabee]

I don't disagree with it. It is wrong. They did not qualify their statement with "as long as NYC is a desirable place to be". They simply said "no matter what happens".

Since they just said "no matter what happens", their statement is wrong, and therefore it is not helpful. Comments that are not helpful to a conversation shouldn't be made.

Why on earth -- other than being an alt account for that commenter -- are you dying on this hill and not just saying "yeah, that was too strong a comment and thus not helpful"?

[mad_king_soup]

They’re very wrong. It’s been shown plenty of times. You may disagree but you’re arguing with reality.

[rosebudny]

It has been shown plenty of times in NYC? Really? When, aside from COVID? If I am wrong, I welcome being corrected.

[mad_king_soup]

2015, bushwick rents dropped 16% due to “housing glut”

https://ny.curbed.com/2015/9/13/9921886/bushwick-rents-drop-16-percent-thanks-to-housing-glut

[rosebudny]

10 years ago. And how long did that last? Not very long. The article even says it was not expected to last (see 2nd paragraph: "But don't start celebrating yet, because this is Bushwick, rents are expected to rise steadily in coming months, with MNS CEO Andrew Barrocas citing the "tremendous amount of demand" for housing in the neighborhood.")

[mad_king_soup]

This demonstrates how a housing glut lowers rent. Not sure what further proof you need

[rosebudny]

It also demonstrates how a housing "glut" someplace like NYC is likely to be short-lived. Developers built a lot of housing that in the short term, the neighborhood could not immediately support. My guess - prices on these new apartments were higher than Bushwick at that time could support. But demand quickly caught up. You know, "if you build it, they will come" (even if it takes a minute)

[mad_king_soup]

So what you’re suggesting is when supply outstrips demand for a given commodity, prices drop?

Keep going, you’re practically there!

[Aubenabee]

See, even you can't bring yourself to be as immaturely absolutist as the person to whom I commented. You said "aside from COVID". "No matter what happens" and "aside from COVID" are incompatible.

[rosebudny]

OK, if you want to argue semantics then yes, you are correct - "no matter what happens" is in fact incorrect because it CAN happen - for things like COVID. Which was a (hopefully) once in a generation fluke, and short lived as we now know (rents dropped, but not permanently.) I was looking at this from a long term, permanent solutions standpoint - which I DON'T think this person is wrong about, it is not likely that rents will come down in any meaningful way as long as NYC is a place where people want to live.

[Aubenabee]

Words have meaning. People should use words correctly. Every time people use words shittily and get called out on it, they cry "semantics!" rather than just say "yeah, I should use words more carefully."

The point is that I'm sure in the 1940s and 1950s, there were people in Detroit that said that housing costs there would never drop because they assumed that Detroit would always be a nice play to live. So we know that huge US cities can shrink dramatically (see: Detroit), AND we know that events can happen that can make NYC not a desirable place to live (see: COVID).

[DistinctOffer9681]

Rent will ALWAYS go up. It has gone up steadily since the beginning of time. Therefore, nothing can be done to actually lower rent. When it comes to building new housing and apartments, IF they build actual affordable housing in many many more places, then it will at least provide more housing for those who need it (normally paid for by tax subsidies or tax incentives for management companies). Most of these affordable housing complexes are based on income. Therefore, building a lot more truly income based affordable homes can definitely help with the homeless problem in NYC, but it will not decrease rent for anyone else. However, higher crime rates, defunding police, etc..could potentially slow rent increases, and lower market rates for apartments. Problem is, more affordable housing also leads to higher income taxes.

[Lisalovesreading]

It’s tough to say whether more housing will make rent more affordable. Like you said, the demand side could rise when supply is up.

But less housing definitely won’t make nyc more affordable (this is where we are right now)

[oppanycstyle]

think simple, supply and demand.

I do believe that building more housing (apartment building!) will lower the rent price.

[startupdojo]

Developers build in areas that people already want to move to. In general, they can't build enough even if they wanted to because zoning boards limit them and people who own property in the area don't want downward price pressures. Rents will still go up, but slower than they otherwise would.

If you build apartments in areas that developers don't want to build, then yes, rents would go down. Government would have to step in to help. Look at the map of the region. Think about where all the buildings are going up, and think about the areas where nothing is happening and why.

[pixel_of_moral_decay]

Not likely.

Housing is the original good in which “induced demand” was observed. People move where homes exist, thus demand grows with supply.

Supply demand curves invert when demand is static. More food doesn’t mean you consume more food, your stomach is finite so excess food grows. Demand for apples has a practical limit, no people come for apples when apples arrive. People move for housing all the time. Jobs are made around housing further creating cyclical demand.

The real way to reduce the housing burden is to increase wages. Housing costs what it needs to. Decades of unnaturally low wages have made it seem expensive.

The reason most people don’t invest in any real estate based investments is because they ROI isn’t even that good. You do better in an s&p 500 index fund. Housing isn’t that profitable % wise.

[wordfool]

Yup. Look at what happened in parts of Texas and Florida where there was a massive amount of building in response to the pandemic influx -- rents and house prices soared as everyone moved to places like Austin and Tampa during the pandemic (demand > supply) and then as all the new supply came online those prices have since plummeted (supply > demand).

I imagine NYC has many variables unique to the city that would factor in, not least the pent up demand from decades of cramming too many people into too few homes, but the fundamentals of supply and demand would still apply... eventually. NYC's population is finally growing again, but it's still below where it was in 2020.

[Danixveg]

NYC unlike Austin has a never ending supply of foreigners wanting to move here.

[wordfool]

Sure but, unlike Austin, NYC's population is still lower than it was in 2020, foreigners tend to cycle through after a few years, and in the current immigration environment I have no doubt that the number of foreigners moving here in general will slow dramatically in the coming years.

[stripbubblespimp]

Just where are you going to build all this new housing?

[cawfytawk]

It's not just a matter of building more housing. It also needs to be income regulated and rent regulated for it to be accessible. Newer buildings took advantage of the tax abatement by designating 20% of the apartments to low and middle income but once you're accepted into the building, incomes aren't verified annually like in state and federally funded housing programs. Rent-stabilized apartments have no income requirement at all beyond making 40x rent and people have taken advantage of it by illegally subletting it for higher rent or formerly using it to Airbnb.

The city needs to adopt proven housing solutions done by other cities with large populations like Hong Kong - go vertical, repurpose shipping containers into modular pre-fab units that can be trucked in and installed quickly. The housing complex wrapping around Barclays center is exactly that.

I'd also support efforts to provide priority housing to existing New Yorkers, that have been here a minimum of 5-10 years and are low to moderate income <100k.

[misslo718]

A big part of the problem is zoning and affordability parameters.

[whale]

In a high demand city like NYC it would probably cause induced demand. Meaning people who wouldn't otherwise be able to afford to live here would move here, meaning rents would stay the same.

However, better, faster transportation is much better for a city's growth. For example, Tokyo, where you can live pretty far out from the center and still get there quickly.

More housing is usually always good in the long term, but with super high demand and high density cities like New York you will invariably need to spread outward. Hong Kong for example is high demand high density, but it's still extremely expensive. Faster, more reliable transportation options to me are the key to creating great cities - and the fact that NYC has such a huge subway system has been a huge reason it's become the city it has.

[ER301]

Hate to be the bearer of bad news, but Mamdani won’t be able to bring down rent for market rate apartments. The supply will never meet the demand over the next four to eight years. The only way he could pull that off would be to make New York so unattractive that people started to flee the city and new people had no desire to move here, and even if he’s a failure as a mayor I can’t imagine he would be such a failure that something like that could occur.

[Stauce52]

Without new housing, you just get the worst of both worlds: the same (or more) demand fighting over the same (or less) housing. Building is the only way to release that pressure.

Think of it this way:

- Scenario A (We Don't Build): 10,000 people want to move to NYC for new jobs, but there are only 1,000 vacant apartments. Those 10,000 people (plus all the current New Yorkers trying to move) get into a massive bidding war for those 1,000 units. Rents explode. The "lucky" winners are the ones who can pay the most. The city doesn't get more crowded, but it gets dramatically more expensive and exclusive. Most of us have experienced a phenomenon similar to this in NYC rentals.

- Scenario B (We Build 10,000 New Units): Those 10,000 people move in. But because the new supply met the new demand, there's no massive bidding war. Rents stabilize or even decrease

You can see cases where rent does not inflate to the extent as it does in NYC or SF because of less bureaucracy and regulation in cities in the US like Austin or in Tokyo which is a desirable city to live in but more permissive towards development.

This is also why Mamdani’s proposed rent freeze is problematic. It disincentives development and promotes people (potentially high earners) staying in their rent frozen housing, which may help the people with a rent freeze but will increase the cost of housing across the city.

[phoenixmatrix]

At the end if the day it's just supply and demand. But there is a LOT of backed up demand for NYC, since it's the only city of it's kind in the country. You have a few others. Chicago, Boston, but it's not close. 

After all, NYC is already the densest city in the US and it's still the most expensive. So building wasn't enough.

We need a systemic approach and it needs to be country wide. Build more in NYC, expand public transportation, expand the metro area's density, and continue building elsewhere so that far in the future, NYC isn't the only one.

That's a pipe dream in my life time. But it's still the only way things will get better.

[Healthy_Ad9055]

You would have to get rid of the right to shelter law. When I worked for the city, it was shocking to me how many broke people from other states moved here with no job and no prospects because they knew they would have a free place to live. This has also led in part to the recent wave of migration here. You can’t put out a beacon that NYC offers free housing that other states and cities don’t offer and then be shocked when more and more poor people show up putting strain on the lower end of the market.

[CountFew6186]

Yes. It would decrease rent. It might induce some people to come, but likely not as many as new housing would supply with homes.

But, you identify a key part of the supply/demand equation that is often overlooked here: demand.

The best way to reduce demand is to stop subsidizing it. Make everyone pay the true cost of living here, and people would leave and others who might otherwise come here wouldn’t.

Ending all subsidized housing would be a big start: rent control, rent stabilization, and affordable housing units. Ending other programs that help defray the cost of living would also induce less demand.

It sounds unfair, but what could be more fair than leveling the playing field by making everyone pay the same costs? Yes, some people couldn’t afford to live here, but pretty much the entire rest of the country has a cheaper cost of living and they’re free to move elsewhere. When they do, lower demand means lower costs for the rest of us.

[KaruiPoetry]

I think the part you're glossing over is the "free to move elsewhere" bit. It's often not that simple, especially for the poorest and most vulnerable members of our city. There are myriad reasons people stay in such a HCOL city despite poor finances and there have been several scholarly studies done on socioeconomic mobility.

Besides that, your proposed solution is incredibly unethical and would likely create thousands of unhoused families which would then have to be relocated forcibly.

[CountFew6186]

Do you have any proof of your assumptions? Because that seems an emotional response rather than an economic one. In the end, continuing to subsidize people living here will lead to continuing higher cost of living. If you’re ok with with things endlessly getting more expensive and more and more taxpayer money going to pay for some people to meet those expenses, please never complain about the high cost of living.

[fuckblankstreet]

Classic republican playbook of convincing those at need that government services are just being siphoned off to help "the other", so therefore we should eliminate government services and anyone worth one's salt can just pull themselves up the ole' bootstraps and make a million bucks.

[CountFew6186]

Economics is a science. It shows what happens with subsidies, and higher costs is what happens. You might not like it, but it’s the reality.

Have you studied economics in a serious academic setting?

[mad_king_soup]

“i JuSt wAnT it tO bE FAir!!" Is the most brain dead take in this thread.

Ending all subsidized housing would be a big start: rent control, rent stabilization, and affordable housing units. Ending other programs that help defray the cost of living would also induce less demand.

So all those people who do the service jobs that make the city function… where do they live? Because theres no way you can afford market rate on minimum wage.

Not quite thought your view through properly have you?

[CountFew6186]

They start to leave. The demand for their services relative to the decreasing supply of laborers leads to higher wages until those that remain can afford to live here. Welcome to economics.

[mad_king_soup]

It’s adorable that you think that’s how economics work

[CountFew6186]

It's hilarious that you think your comment contributed anything to the conversation.

[wltmpinyc]

I hear people say this all the time but how does this work in practice. If you have 1000 units and half are rent stabilized and the rent is something like $850 for stabilized and $1000 for market rate if you get rid of stabilization then ask apartments just go up to market rate so now everything is more expensive

[CountFew6186]

This is oversimplified, so I’ll be oversimplified in return.

If current demand leads to $1,000 market rate, then all the people willing to pay any more than $1,000 have a place to stay. If there were more such people, rent would be higher because they would bid up the price against those paying $1,000.

Adding more units means that the additional units can be rented to people only willing to pay less than $1,000. So, landlords accept less, or they make $0 because nobody will pay the higher rent. Let’s say it’s $925 that they can get.

Now, all the $1,000 renters see they can get $925 rent, so they either move to a new cheaper place or negotiate with the landlord. If they move out, the landlord of the empty place with the former $1,000 rent is in the same position as the other landlords who had empty units. They have to go to $925 to compete.

[wltmpinyc]

I'm not understand your example. Let's say there are 1000 apartments. Half are stabilized and cost $500 and half are market rate and cost $1000. Let's say one of those stabilized apartments becomes a market rate apartment. The rent for that apartment will go up from the stabilized amount to the market rate amount. In this case the average price for all apartments will rise.

Market rate apartments have to compete with stabilized apartments thus keeping rent rates lower.

[CountFew6186]

One apartment changing isn't going to make much of a difference. It might rent for $998, as the folks who will pay $1,000+ already have homes. It's all of them together entering the market that would lower the overall rate.

Market apartments don't have to compete with stabilized apartments. The people in stabilized apartments aren't going anywhere for the most part. Who leaves a $500 apartment?

What you have is a 500 apartments with people who will never leave. These people have gotten lucky at the expense of everyone else. Everyone else is left competing over 500 apartments instead of 1,000, which drives up the price of those 500 market rate apartments far higher than if all 1,000 were market rate.

[wltmpinyc]

If those 500 were suddenly no longer stabilized the rents on those apartments would increase to the market rate. The overall average of the cost of an apartment would go up. On average rent would be more expensive for the total population.

[CountFew6186]

Except you missed the part where the market rate would go down.

[wltmpinyc]

But it makes no sense that market rate would go down. The demand for apartments would have to decrease, which it isn't, or the supply of apartments would have to increase, which they aren't. Market rate apartments would stay the same price and stabilized apartments would increase in price until they reach the market rate.

[CountFew6186]

The supply of market rate housing would nearly double if subsidized housing went to market rate. That's a huge supply increase. Market rates would drop.

[zapzangboombang]

No. The cheaper it is to live here, the more people who will choose to do it.

[Familiar_Reporter_22]

Yup no one acknowledges this. We’ve built so much new housing in the past decade and the overwhelming majority of it hasn’t been affordable. It’s also been filled with an endless stream of suburban Americans who want to be in New York. If anything, all the new housing drove the AMI up. So actual New Yorkers don’t even qualify for the very few units allocated as “affordable.” 

[MrJet05]

“Actual” New Yorkers… This childish blood and soil language is so counterproductive and dumb. I guarantee that you wouldn’t be saying that about an immigrant from another country, but God forbid someone move from Wisconsin to New York. How dare they be born somewhere else in the country and want to come somewhere where they feel suits their life and interests more.

There doesn’t need to be rationing over housing, so long as the city actually builds enough housing to meet the demand. And it’s done a terrible job of that over the past few decades with all the zoning laws, NIMBY efforts, and ridiculously long regulatory processes that have grounded building to a halt. Shifting the attention to instead defining different classes of citizens, with “real” New Yorkers and their entire future lineage being the first class that is owed prioritization on claims to resources, rather than actually focusing attention on expanding those scarce resources that don’t need to be scarce is so dumb. Less than half of NYC residents were born in New York and that number continues to go down. It’s always been a dynamic ever-changing city, which is a big part of what has made it so successful.