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How Do You Fight a Housing Market Gone Mad?

The death of public housing in New York City is a slow-motion crisis.


Earlier this month, New York City mayor Bill de Blasio attempted to assuage the fears of public housing residents in a rapidly gentrifying neighborhood in Brooklyn. At issue was a proposal to start leasing the public land abutting their homes to developers in order to replenish the New York City Housing Authority’s depleted coffers. It was a difficult task for de Blasio: For decades federal and state funds for public housing have disappeared, leaving the New York City Housing Authority—the nation’s largest public housing authority, by far—with deteriorating buildings and enervated organizational capabilities. Ignored by previous mayors and governors, the public housing authority now needs a staggering amount of money to adequately serve the people it houses: The organization faces $17 billion in capital debt.

“You go down the list: everything costs money. Everything costs money,” de Blasio told the group of public housing residents, who live a few blocks away from Brooklyn’s newly minted mega-venue, the Barclays Center (part of a private development project that will receive $1.6 billion in government funding), “So what can the city do for itself?”

In a sentence, de Blasio had summarized the main housing issue that all large and diverse American cities have faced since the Reagan administration. Robbed of nearly all federal support for housing initiatives, cities have been left to figure out how to themselves create and maintain housing for residents who cannot keep up with market-rate rents. New York City, for example, once had a diverse set of subsidized programs that allowed residents to pay under market rates for housing—such as Section 8, Mitchell-Lama, and NYCHA’s own initiatives. The city has then watched as a large amount of this subsidized housing has evaporated; some from the lack of federal support, and some because of landlords exiting the subsidized programs to make more money on wealthier tenants. 

Market-rate rental prices across the country have proved just as destructive to affordable housing stocks as the lack of federal support for it—last year, rents in five of the ten priciest American cities had double-digit percentage increases for the price of an average rental. There’s more money than ever to be had building market-rate housing, which takes away much of the leverage cities and states had to entice developers to agree to build low or moderate income housing. Before, the city offered cheap land to developers as well as subsidized mortgages for construction, which are no longer so attractive as they once were. When de Blasio asked, “So what can the city do for itself?”, he might have also said: What can a city do, left almost completely on its own, to fight against a housing market gone mad? 

De Blasio’s plan for public housing, termed NextGen NYCHA, uses land that the city already owns, leasing it for new development. De Blasio’s administration promises that it will be, for the most part, deemed “affordable.” (According to the De Blasio administration, “affordable” units will be available to New Yorkers with around 60 percent of the area median income, which translates to $46,000. The average income of a NYCHA family is about $25,000.) The money raised actually won’t go very far
in improving conditions at public housing sites, but the project will help create 10,000 new affordable units—a boon in New York City’s pitched battle against a housing market that’s reshaping the social fabric of the city.

So, if the leasing of public land to private development won’t really put a dent in NYCHA’s debt, what benefit will the plan really have for residents of public housing? Advocates believe the plan will help open up the areas around public housing to other city-dwellers and desegregate portions of neighborhoods previously only occupied by low-income residents. Public housing remains at the center of some of New York City’s up-and-coming neighborhoods, having retained a low-income population despite the market. Which means you have gigantic luxury condo developments popping up literally across the street from deteriorating buildings that house thousands of low-income people.

For many low-income residents, having been shut out of the mortgage marketplace by federally-supported discrimination—also known as redliningpublic housing is the only way they could live near the city center. As such, it became a refuge for low-income minorities in American cities, even as landlords destroyed the existing affordable housing stock in an attempt to move in more affluent tenants.

The de Blasio plan essentially codifies the practice of having wealthier people living next door to housing projects, a practice that hasn’t yet produced the kind of civic harmony that proponents of this one-sided desegregation would like to believe will occur. For example, since Columbia University began an aggressive campaign to upscale large parts of West Harlem, the NYPD has responded by cracking down on public housing residents, issuing mass arrests as part of an anti-gang initiative. Instead of creating a more beneficial atmosphere for all, these housing efforts have only resulted in more policing of low-income people. That’s a trade that many in public housing wouldn’t want to make, and it’s why so many are skeptical of the mayor’s plan. 

Across the country right now, mayors are looking at the housing crunch and wondering what, exactly, they can do. The best solution de Blasio—a progressive who has long been committed to the need for affordable housing—could come up with will take away even more resources from public housing residents, even as it promises that a more fluid and income-diversified neighborhood will help low-income residents in the long run. “You can’t get something for nothing,” he said, emphasizing that state and federal funds are scarce and unlikely to increase soon. “I think the honest answer is, no, I don’t know of a lot of ways to make money that we haven’t found.” From his comments, it sounds like de Blasio knows this isn’t a very good answer. 

The truth of the matter: Without the federal subsidies that helped build affordable housing in large American cities in the first place, there will most likely never be a place for low-income people in their interior again. Over the next few years, cities will become much more homogeneous, unequal, and segregated, leaving a place like New York City a fully realized version of the “luxury product,” as Michael Bloomberg, the previous mayor, put it. Oakland, CA, which is also dealing with skyrocketing rents, has yet to come to terms with its own need to maintain affordable housing: The city’s top housing official said, on record, “There is no housing crisis in Oakland.” A UC Berkeley report published in July would seem to disagree. “The severity of the affordability crisis continues to accelerate, with continuously rising rents and a tremendous jump in rates of housing burden,” it reads in part. If mayors across the country don’t come up with something more radical than leasing land to developers to help tread water in the affordable housing market, then affordable housing will continue to deteriorate around the people living in it—the people who need it most. 

On Friday morning, in reaction to de Blasio’s NYCHA plan, the head of NYCHA’s largest workers union and the chairman of the New York State Assembly’s housing committee called on the state to take over NYCHA, fearing that the mayor’s plan would further gentrify neighborhoods surrounding NYCHA houses and do nothing for tenants in return. People are fed up.