New Yorkers Get Historic Rent Freeze

A Rent Guidelines Board meeting in early June (AP Photo/Seth Wenig)

“A normal market of free bargaining between landlord and tenant” is probably the last phrase anybody would use to describe New York City’s red-hot rental market. The city has one of the highest rent burdens in the nation, and on top of base rent, many landlords try to extract even more from tenants in the form of broker fees, vacancy bonuses, and taxes on amenities like air conditioning units and washing machines. While speaking about the city’s housing issues at a Rent Guidelines Board meeting last night, Chair Rachel Godsil held up the “normal market of free bargaining” as an ideal, not a status quo.

And then New York City’s Rent Guidelines Board did something it had never done in its 46-year history: It granted a rent freeze to more than a million New Yorkers.

The rent freeze, which passed in a 7-2 vote, is a major victory for New York’s tenant advocates. New York’s rent regulations are famously complex, and overall they cover about a million apartments and 2.5 million tenants, 45 percent of the city’s rental housing stock. If a building has six or more units and was built before 1974, there’s a good chance it’s rent-stabilized, which means landlords must allow tenants to renew their leases and can only raise the rent by a set percentage every year. The catch: Albany is responsible for crafting (and renewing) these regulations, essentially leaving local government powerless to set its own rent laws.

The Rent Guidelines Board, which sets annual rent hikes for rent-stabilized apartments, is one of the few leverage points the city does have. Coming off of last year’s RGB decision, which allowed 1 percent increases for one-year leases and 2.75 percent increases for two-year leases, tenant advocates demanded something unprecedented: a rent rollback. They didn’t get it — RGB member Sheila Garcia flatly admitted that they didn’t have the votes — but a freeze on one-year leases and a 2 percent increase for two-year leases still represents a significant victory.

This wasn’t the first time tenant groups pushed for a rent freeze, but for several reasons, it was the first time they succeeded. First, all nine members of the RGB now owe their appointment (or reappointment) to Mayor Bill de Blasio. Last year’s board included several business-friendly holdovers from the Bloomberg administration, but they have since departed. Second, the RGB’s annual research on cost of living and housing expenses showed that landlord operating costs rose 0.5 percent during the last year, an unusually low increase due largely to the low cost of heating oil. Whether or not the rent increase stays intact in years to come, landlords have had a very good year—and that surely strengthened the tenants’ case.

As a result, landlord advocates basically knew in advance that they were going to lose. Jack Freund of the Rent Stabilization Association, the trade group for the city’s landlords, told me, “There is no best-case scenario.” He predicted a rent freeze “would be a disaster for the city’s housing stock, a disaster for Mayor de Blasio’s housing plan, and just a very ill-conceived notion. … If that’s what [the] board wants, that’s what they’re going to get.”

When Sara Williams Willard, one of the RGB members who represents landlords, had her turn to speak, she was almost drowned out by boos from those in attendance. Willard said of the rent freeze, “This is myopic, it’s biased, and it’s selective listening. … I vote absolutely a resounding ‘no.’” But ultimately only Williams Willard and Scott Walsh, the RGB’s other landlord representative, cast dissenting votes.

Throughout the evening, tenant activists in the crowd were consistently louder and more upbeat. Even before the vote took place, chants in English and Spanish filled the hall and the surrounding streets. One chant, “Cuomo betrayed us! The RGB can save us!” displayed palpable anger at the Governor who many activists believe sold out tenants last week by waiting to pass a new package of rent regulations until after the old ones expired.

After the vote, tenants were measured in their optimism. Garcia, the RGB member who introduced the rent-freeze proposal, told me she was “hanging in there” after the vote, disappointed she hadn’t been able to secure a rollback. Thomas Williams, a rent-stabilized tenant from Brooklyn’s Ditmas Park and member of the Flatbush Tenant Coalition, said that he signed a two-year lease last year, and as a result, “I’m happy for people that got it, but for myself, it does me no good.” He also said that almost everyone in his neighborhood has been the victim of aggressive tactics by landlords. Being pressured to take a buyout and move to a smaller apartment, having necessary repairs go undone for months, and getting dragged into housing court on false charges are all par for the course, Williams told me.

The leaders of the city’s affordable housing advocacy groups were happy to portray the victory as a sign of things to come. Citing the opening provided by a progressive mayor and a skyrocketing cost of living for the average New Yorker, Jonathan Furlong of the Association for Neighborhood Housing and Development said tenants would be more aggressive than ever in defending their rights.

“There is momentum going in that direction,” he said. “This is a win for tenants given the disastrous climate in Albany.” Affordable housing activists and de Blasio haven’t always seen eye to eye, especially when it comes to the Mayor’s proposed rezonings around the city. But this is one area where he can brag that he promised — and delivered.