[music]

Brian Lehrer: Brian Lehrer on WNYC. With rent prices spiking in our area now even as the economy slows and inflation roars, we'll do a comparison now between Mayor Adams' approach to affordable housing and that of his predecessors, de Blasio and Bloomberg. The Adams plan covers a lot of ground, we'll say, upfront. It aims to preserve affordable housing units to fast-track new supportive housing. That's important. The category of supportive housing. We'll talk about that, and to modernize NYCHA apartments.

Other objectives of the mayor's plan include new mixed-income rental units, a path to affordable homeownership, and better access to housing for the unhoused. It's an ambitious undertaking to be sure, but a story in the Gotham Gazette observed that Adams' approach to affordable housing "reflects a paradigm shift from his predecessor who tackled the city's lack of affordable housing, its crumbling housing stock, and rampant homelessness largely as separate problems." The plan also leaves big, unanswered questions, which Adams acknowledged when he unveiled it in June.

Mayor Adams: How many units are you going to build? How many units are you going to build? How many units are you going to build? If that is one of the on-topic questions you're going to ask me, don't because I'm not answering that. How many people are we going to put in housing? We need to put people in housing. That's the focus that we are on.

Brian: Focus on putting people in housing, not on how many units are you going to build, and the question that he seems to suggest he's getting asked ad nauseam and thinks is the wrong question. That's a big difference from the past right there. Bloomberg and de Blasio both touted how many hundreds of thousands of units they could help to build to bring supply and demand more into line.

Remember, Adams doesn't seem to want to give a number or to emphasize that goal, but does it make sense when supply and demand are so out of whack? Some housing advocates and experts have praised the mayor for tackling what he calls the entire spectrum of New York's housing needs, but they've also called for more investment. The plan that Adams announced brings the city's total investment in affordable housing to $22 billion over the next 10 years.

That's a number in The New York Times, but that's still a billion-dollar short of what the mayor promised when he was campaigning. We'll get into all of that now with Matthew Murphy, executive director of the NYU Furman Center, out with a report published last month about the state of New York City's housing and neighborhoods. We'll talk about the report too. Hi, Matt. Thanks for doing this. Great to have you with us.

Matthew Murphy: Hi, Brian. Thank you for having me.

Brian: Before we get into the specifics of your report, I wonder if you have a view of how different Mayor Adams' housing plan is from those of his two immediate predecessors.

Matthew: Yes, I do think what you brought up is the most obvious difference that there is not a production number. Production, I think, is important to distinguish that when you look at the Bloomberg plan and the de Blasio plan, production really split into two places. One was new construction and the other is preservation. When we're saying production, we're talking about there not being a number for new construction or preservation.

Then the other, I think, is, as you mentioned, the inclusion of more issues around NYCHA and homelessness than you saw in prior plans. You can say it's less of a silo. Other than that though, I think a lot of the things in the plan reflect what is within the city's capacity to address housing issues. In a lot of ways, it's a continuation of similar policies. There's some new stuff to focus on. The big differences are really going to be about, well, how do you measure success?

Brian: Can you focus then on the distinction that the mayor made in that clip? He effectively said the city should focus on getting as many people as possible into housing, not on sending unit goals, but how does a mayor get more people into housing without committing to a set number of new apartments?

Matthew: Yes, I think that's obviously the main question of, how do we distinguish between the supply side and the demand side? For example, we could put a lot of new people into housing, but if a lot of people lose their housing, then the question is, what was the net benefit? The supply issue is a major one and it continues to be. When you look at our vacancy rate even in the COVID era, probably the most distressed the city's faced since 2001, we still maintained a pretty low vacancy rate. It inched up a little bit compared to 2017, but still fell below the 5% threshold we look to and I can--

Brian: That's just for context for our listeners. That's the supply and demand issue in a nutshell. If we have so few vacant departments, then people who are looking for apartments are competing with other people looking for apartments and that pushes the price up?

Matthew: Absolutely. We still continue to see that dynamic. We should expect it to go forward. The thing about the people side of it is let's just call it for the purposes of simplicity, a functionally 0% vacancy rate. That's what we're facing essentially, especially for low-cost housing. It is basically 0% of our low-cost housing that's available. The question then becomes, okay, housing people into new housing opportunities or into the existing stock.

If you look at, well, what are the sources of that housing going to be? New housing is going to have to be a major one. On the market side, we can split this up into providing market-rate housing and also then the income-restricted housing that the city finances and builds. Historically, we have basically, in the last two plans, seen a new construction number that was based on the budget and capacity of the city. That was about 8,000 new units per year of affordable housing.

Brian: That's not much.

Matthew: It's not much. Part of the reason for that is just the limitation of resources. You have to look to the market side. You have to look to the city government and leverage also the land-use side, which is a big restriction on new housing to be built is just what is our city actually zoned for.

[crosstalk]

Brian: Go ahead. Finish the thought. Sorry.

Matthew: In terms of housing people, it ultimately will also come back to a question of a functionally 0% vacancy market. Well, in what housing will they go to?

Brian: Well, that market side, I think, is one of the central dilemmas always. We want to build more affordable housing however we define affordable. More affordable housing, but the developers have to have enough profit incentive from what they build in order for them to go about doing it because the city and the state don't have enough money to build hundreds of thousands of apartments. There has to be a profit motive in there somewhere is the assumption.

The way that Bloomberg and, even more so, de Blasio went at it was to have mandatory percentages of affordable in new developments. If those percentages were 20%, 25% as they'd been in many cases, that still skews the market toward more expensive. Because if you take a neighborhood with a lot of low-income housing and you put up a big, new building and 80% of it is market rate, which means they can charge more than the prevailing rents, then that's going to draw, on average, more affluent people there.

Gentrification will start to occur even though they're adding 20%, 25% more affordable units, at least 20%, 25% of that new building. That's the dilemma, right? How do you get developers to build the affordable housing without enough incentive for them to make money on market-rate housing? If they make that money on market-rate housing, then the affordable units that they include don't actually change the scene.

Matthew: Yes, absolutely. I think I would characterize it that way. I would also distinguish what we have seen historically is really affordable housing that comes from the market. The local government saying you have to do affordable housing because you got a zoning bonus, or you have to do affordable housing because you got a property tax benefit. We've seen a good amount of income-restricted, affordable housing come from those programs.

The other side of it is more heavily subsidized affordable housing. Those are really a combination of city loans, federal tax credits, property tax benefits, zoning changes. I distinguish it that way because I think for us to achieve this fair or more equitable housing market where the market is competitive and, therefore, helpful to renters, we absolutely need more market-rate housing. Given where construction costs are, we can't point to it as the only solution because then we would be leaving out a lot of people who are low-income.

The market doesn't actually provide a lot of housing that would serve low-income. That's where our subsidies come in. I think that the continuation of that policy is really important, meaning you have to do both approaches. Otherwise, we would be in a situation where we'd be asking the market to do everything. I think that would leave out too many people. The flip side of it that you brought up is asking the government to do everything.

I just personally don't think that's feasible from the perspective that's too much housing for the government to build. It's a whole supply chain that has to be managed by the government. It's a huge amount of investment that would have to be made. We're not at this centralized government supplying all housing model. We're at a point where we have just a lot of developers, both for-profit and non-profit, that build low-income or income-restricted housing, and then we have people that build market-rate housing as well.

Brian: Listeners, we can take a few phone calls for Matt Murphy, executive director of the NYU Furman Center, which studies housing policy. It's a research and policy organization with a focus on affordable housing, real estate, and land use at NYU. We can take your questions as we compare Mayor Adams' approach to affordable housing to his predecessors, de Blasio and Bloomberg. 212-433-WNYC, 212-433-9692, or tweet @BrianLehrer. Let's take a phone call right now. Adam in Queens, you're on WNYC. Hi, Adam.

Adam: Hi. How's it going, Brian? I have a question. I'm wondering how they come up with these ratios and income percentages for affordable housing because I'm in a bunch of lotteries. Where I live, it's largely like you're only eligible for these affordable housing rates if you're at 120% or 130% of the median income, but the apartments wind up being even more than I'm already paying in rent that I got through the market. Like a two-bedroom apartment under this affordable housing, it's still well over $3,000 a month. Even if I got picked from the lottery, I wouldn't be able to afford it. I don't understand where they're getting these ratios from.

Brian: Can you explain it, Matt? I think a lot of people are in Adam's boat.

Matthew: Yes. Well, each development has different ratios as you call them. We'll use the dreaded term "area median income." A lot of things that you see on Housing Connect or you're going to see advertisements that say, "Here's your allowed income. Here's the rent you pay." The income restrictions or qualifications really come from the program that helps create that housing. The rents are set according to that program's requirements.

In the instance you're talking about, you're actually talking about-- I actually know the program. It's the Affordable New York program or the 421a program, where you have 130% AMI units that are allowed by law in most new multifamily housing at this point. As you mentioned, those rents can be really high. The reason for that is that rents are allowed to be at 30% of those income limits.

For people that are at a higher income or middle income, they actually are not paying typically 30% of their income towards rent. They're paying closer to 20% or 25%. Compared to the market, when it has to be 30% but you're used to paying 20% or 25% at that income level, that can be too much of a rent to absorb. I think that's why you saw just broadly this kind of question of how to reform the 421a program to make it more feasible for regular New Yorkers just to move into a new rental house.

Brian: The tax breaks that developers get would force them to build housing that was more affordable than the "affordable housing" that they could get away with building under the old model. Adam, thank you for starting that part of the discussion. In fact, they'll let you all in on a little behind-the-scenes thing. Adam's question was so good that, of course, my producer and I have a back-channel conversation while Matt was giving his answer to Adam in Queens.

We're going to plan a segment that's kind of a news you can use, guide to the affordable housing programs that exist today in New York City and how you can enter those lotteries and who qualifies for what, so watch this space and we'll do that sometime, let's say, in the next few weeks. Let's get back to the mayor's housing plan. Compared to the previous two mayors' housing plans, the emphasis that Adams says is that he's concerned with quality, not quantity.

He did say that the city would build 15,000 units of supportive housing, previously scheduled to be completed by 2030, two years ahead of schedule. That's not a big change, but it's part of his focus on quality, and that is supportive housing. What currently is the definition of supportive housing for people who are unhoused or at risk of homelessness, and will 15,000 new units of supportive housing across the city substantively make a difference for that population?

Matthew: Yes, so supportive housing is different from what I'll call affordable housing or income-restricted housing. I'm realizing we have a lot of terms that are pretty confusing, so I think that segment will be really helpful. Supportive housing is much more directed at households who experience homelessness. There's no lottery for supportive housing. Like Adam just called in and talked about applying to the lottery and supportive housing, we don't have that.

They're actually based on referrals for families coming out of homeless shelters. The model of supportive housing is to be very affordable and also to be supported by on-site services, so meaning that there's a deeper investment, I would say, in the families who live in supportive housing than typical income-restricted or affordable housing. It's meant to serve through new housing.

The families that have actually experienced homelessness versus the affordable housing or income-restricted housing, which is it's an open lottery for people to apply. It's a model that has been around for the last couple of decades. It's meant to be very much focused on the more vulnerable to homelessness households. It's more heavily subsidized and different forms of financing go into it. The state isn't on it as well in terms of setting this shared goal together with the city. Is 15,000 units enough?

I would call it feasible, both economically and through the budget and also just based on the capacity of organizations, given where we are and where we see homelessness and where you can expect homelessness to increase. No, it's not enough. It wouldn't serve everybody, but part of the whole strategy here is to have a lot of different housing types that serve different housing needs. Supportive housing is very focused on the households that are really left out of the income-restricted housing or even market-rate housing too.

Brian: People with mental health problems, people with addiction problems, those most likely to become homeless, and then cause problems for other people. That's part of the politics, right? Nobody else likes seeing homeless people on the street, especially those who have certain kinds of problems and make other people feel threatened even if that's a rare occurrence, and so supportive housing to help people at the most risk of homelessness or who are currently unhoused to be in a place that can sustain them and they won't fall back to the street. That's a big challenge. Is the mayor's plan up to it with 15,000 units? That number, by 2028, seems like a long time from now. That's one of the questions. Marie in the Bronx, you're on WNYC. Hi, Marie.

Marie: Yes, good morning. I wanted to know if Mayor Adams' plan is asking for a revision of zoning and residential area R2, R4, R6. Is he planning to change this to increase building hype? I call from the area of Kingsbridge where there's still some restriction, but I was interested to know if there were changes in the works. Thank you very much.

Brian: Thank you. Matt?

Matthew: Terrific question. You see in the plan, a description of changing the zoning resolution in a few ways. Zoning resolution is what governs the zoning of the city. In addition to that, you also see an independent of the plan that the mayor has made remarks about specifically looking at a few neighborhoods to increase the zoning capacity for residential housing. Some of the neighborhoods are actually in the Bronx, areas around new Metro-North stations he has spoken about in addition to in Brooklyn along Atlantic Avenue.

You might expect more to come. You have this focused effort on what we would call a neighborhood-wide rezoning, which I think is what you're referring to, Marie, but then you can expect two things. One is there will be applications for rezonings at independent sites or privately-owned sites. For example, in Throggs Neck or-- I'm trying to think of some other high-profile examples. You've seen developers come in with a proposal to change the zoning of their site. You could still see some of that going forward.

I think the mayor has announced basically that they would be supportive of those kinds of changes. Then you also see an interesting focus on tinkering with the existing zoning resolution in a way that would provide more housing options. I think you can call it more efficient housing options, smaller units. There are a lot of areas in the city that restrict smaller units or have something called a density regulation. That just prevents a cost-effective way of providing new housing.

I think all of that is on the table for the mayor. In our report, we found that about just over 30% of new housing that was created between 2010 and 2020 came from city parcels that were rezoned in some way. That's a lot of new housing that comes from those types of land-use changes. It is an important source of new housing. Also, you see a lot of pushback on those types of zoning changes. I'd expect that to continue regardless of who the mayor is.

Brian: Everybody wants more density for more affordable housing in theory, but nobody wants it in their neighborhood.

Matthew: Yes.

Brian: Here's a related, very interesting question from a listener on Twitter. It goes to Marie's question from Kingsbridge, but also to what we were saying before, what you were saying before, and my guest is Matt Murphy from the Furman Center at NYU, which studies affordable housing, what you were saying about the limits of government from building massive numbers of new affordable units.

Some of our listeners are thinking, "Wait, they used to do that." For example, this listener tweets, "My father was lead architect on middle-income housing. The client was ILGWU, the Ladies' Garment Workers' Union. In the 1950s and '60s, they built Starrett City, Penn South, the Amalgamated, and Co-op City. Where is that source today?" I guess we could throw in all the NYCHA public housing, which was New York and federal money way back when. Where is that kind of source today at that scale or why isn't it here?

Matthew: Well, it's a terrific question. I think something that's so interesting about both housing plans and mayors and just the rich history of New York is how they reflect the different eras, how housing reflects the different eras that we're in. I would call us currently in the era of very much like public-private partnership-focused, meaning a high expectation of the private market to produce new housing, to produce the housing that's needed, and then also bringing in public subsidy and pairing it in to see income-restricted housing both supplied within that, and then also to supply the affordable, income-restricted housing that gets built that's 100% income-restricted.

The first thing I would point to as to why don't we have that model is the federal government structure has changed significantly. In 1986, we had tax reform that created something called the low-income housing tax credit. We have basically shifted a lot of our supply-side dollars into using that low-income housing tax credit. You've seen a dramatic shift, for example, of more income-restricted, affordable housing be produced under that, especially in the last 20 years.

Then in the state of New York or even in the era you're talking about, the listener who tweeted in, we saw in the middle of the 20th century, the development of Mitchell-Lama co-ops or rental housing built with a package of state subsidies. An abundance of land was available to make some of that work. [coughs] Excuse me. I'm battling a cold. We have a much different system now.

We don't have as much of that land. We don't have as much of-- I guess I would call it an infrastructure to build that type of middle-income housing. Like I mentioned before, a lot of our housing is built using federal resources. The federal resources that are made available come in a few forms. One is the low-income housing tax credit I mentioned. Another is the use of housing choice vouchers or Section 8 housing, which can be put into projects to help support the financing or can be allocated to individuals.

Then what you have seen is the federal government move to investing in public housing, but even moving public housing nationally away from the funding structure that had been relied upon towards something that allowed for this leveraging of debt. I think that a lot of things have changed since then. I didn't mean to say you couldn't have that kind of system. It's just that the way things are working today, it's-

Brian: It's not feasible.

Matthew: -very market-dependent. Yes, it's just not.

Brian: This is WNYC-FM HD and AM New York, WNJT-FM 88.1 Trenton, WNJP 88.5 Sussex, WNJY 89.3 Netcong, and WNJO 90.3 Toms River. We are New York and New Jersey Public Radio and live streaming at wnyc.org as we finish up with Matthew Murphy from the Furman Center at NYU, which studies affordable housing, as we compare Mayor Adams' approach now that he's been in office six months to affordable housing with very different approaches from de Blasio and Bloomberg.

Just to touch on one more before you go. Another pillar of his housing blueprint is an expansion of affordable homeownership opportunities. One of the specifics on that is to turn what he calls "zombie homes" into affordable homes. I think it's probably no accident that the mayor comes from Southeast Queens, which is a real bastion of Black middle-class homeownership, and he believes in that.

We also had the financial crisis, the mortgage crisis of 15 years ago, when a lot of loans were given out in the name of making housing more affordable to more kinds of families. A lot of people defaulted and wound up getting foreclosed on. What are zombie homes and where do you see homeownership fitting into an affordable housing plan in 2022?

Matthew: I think that's a terrific question and also a great moment to think about. Some advantages of not having a production number are, I think, you can be a little more creative when it comes to the smaller scale. Homeownership is a good example of the smaller scale. The first thing is, what are zombie homes? Zombie homes, it's a terrific name for what they are just from the sense that they are these properties that are really abandoned, and also in this territory of not really clear who exactly is responsible for the maintenance of the property because they have gone through foreclosure.

Technically, the bank should own them, but a bank might not manage the property according to the standards that you would expect. They become this kind of zombie in the sense that they are there. I actually don't know what a good analogy to a zombie is. I was about to say "undead," but there's no responsible homeowner who's maintaining the property. The idea is to transform them into use that matters to people. Here, it's homeownership.

If you look at the history again of New York City housing of Mayor Koch, a lot of his plan was to restimulate the use of the existing housing stock, which the city had taken ownership of. Invest in it and then dispose of it to non-profits or even for-profits. I would equate this similarly that you have this vacant property that needs investment and needs care. You don't have a specific owner.

Somebody needs to step in and do that. I think that's a city of New York characteristic to self-invest, to put money into its housing stock and its neighborhoods, and put it on a better path. I think that's what you see reflected in the description of that plan. Southeast Queens and Queens in general was really hard-hit by the foreclosure crisis as you mentioned, Brian, and in some places still recovering.

Then I think, now, there's a lot of questions about homeownership going forward, higher inflation rates. We might hit a recession and these have consequences. You might expect actually for some of that to come back even. I think a big question on homeownership is balancing, again, the resources we have for preserving existing homeownership versus creating new homeownership. When it comes to creating new, affordable homeownership, it's just very tricky.

On one hand, you want to give people stability, control over decision-making, and a return, which is a very key feature of homeownership is that the asset appreciates. At the same time, when it comes to affordability, you also want future generations to benefit from that. You cap some of that appreciation or even some of the control over decision-making. I think it becomes really tricky. I'm really interested in hearing more about how the Adams administration is going to pursue a comprehensive homeownership policy.

Brian: All right, so there is a six-month check-in on how Mayor Adams is approaching affordable housing, different from his last two predecessors. You can read more about the state of New York City's housing and neighborhoods from a report by that name from the Furman Center, which was released last month. For now, we thank Matthew Murphy, executive director of the NYU Furman Center, which is out with a report published last month about the state of New York City's housing and neighborhoods. Matthew, thanks for joining us and diving pretty deep on how Adams is starting out on this track compared to de Blasio and Bloomberg. Thanks a lot.

Matthew: Thank you so much, Brian.

Copyright © 2022 New York Public Radio. All rights reserved. Visit our website terms of use at www.wnyc.org for further information.

New York Public Radio transcripts are created on a rush deadline, often by contractors. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of New York Public Radio’s programming is the audio record.