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I have no idea what the market rent for a 2 bedroom apartment in East New York Brooklyn would be but I know currently in the Bronx, the going rate for a 2 bedroom apartment is between $1,200 - $1,400 depending on what section of the Bronx you are in.
I assume the price is somewhat close to that range or maybe a bit more since Brooklyn is much closer to the City than the Bronx is.
I'm not saying to abolish rent stabilization without having a back-up plan like having the City pick up the tab by deducting the differance from the cheap rents and market rents and applying that amount as a deduction to the landlord's property tax bill.
Example: If a landlord pays $60,000 in property tax a year, and the differance between market rents and stabilized rents in a year is let's say $10,000 a year,
The City should DEDUCT $10,000 from the $60,000 property tax bill. The Landlord's new property tax bill is now $50,000.
It's a win-win situation for BOTH tenant and landlord. The tenant gets to stay in the apartment and DOES NOT get displaced and the landlord collects his Market RENTS so that he can pay his Market EXPENSES.
That's what you call a balanced system and that's how the Rent Stabilization system should of been structured in the first place instead of having the landlord subsidize the low income tenants out of their own pockets.
It's a very simple concept to understand.
Doesn't this proposal sound fair?
Yes, it would be fair. But there would be one large group that would vociferously oppose it, and probably politically block it. That is the "middle class" and wealthier tenants who are now paying artificially low rents. Your plan I assume would correctly not offer city subsidies for these rents. They could well afford higher rents and should pay higher rents. Everybody in the city would benefit except them. The problem is that they control the powerful tenant lobby that the politicians fear.
The only way to overcome this political problem is to bring these issues out for public debate. When the pro and cons of rent regs are exposed to the light of day, the general public would wake up and counter balance the influence of the low-rent tenant lobby.
well its not a desirable neighborhood....so take this example:
i have an 80 unit building in highbridge and you have an 80 unit building in park slope. so expenses are roughly the same.
how can i justify charging my tenants the same rent as u charge your when my neighborhood is worse? so i cant trust a landlord to determine what is market rate.
the FDA governs food and pharmaceuticals. SEC governs finance. landlords need somebody to govern them too.
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the rent would not go down because landlords primary concern is profit. being a landlord is not a non-profit organization where you're breaking even every year. why wasnt rent stabilization a problem in the 80s then?
It was always a problem, but back in the 80's the expenses were extremely low compared to today. And since expenses are actually increasing each year more then the allowed % that a LL can increase his rent, then the more with time the apartment becomes more and more of an expense.
Also landlord don't set the prices, the economy does. In the world of capitalism the supply and demand set the price.
I hope we can get back to what we can do to overcome the political obstacle blocking an overhaul of the system.
Well, unless politicians, or the TGB, or someone in authority is reading this forum (and taking action based on it), I doubt that much that's said here really counts for much .....
well its not a desirable neighborhood....so take this example:
i have an 80 unit building in highbridge and you have an 80 unit building in park slope. so expenses are roughly the same.
how can i justify charging my tenants the same rent as u charge your when my neighborhood is worse? so i cant trust a landlord to determine what is market rate.
the FDA governs food and pharmaceuticals. SEC governs finance. landlords need somebody to govern them too.
The expenses are not the same, because the mortgage on the building would be different since the prices on the building are different.
A landlord doesn't determine the market rate, the landlord would put a price tag on it if it doesn't rent for that price he would have 2 options:
1. Lower the price
2. Leave it vacant and lose money.
Let say that I own an apartment in Bay Ridge, could never rent this apartment for 5,000 dollars because nobody would pay for it, I would have to rent it for 1,200 -1,300 because that is what people are willing to pay for a one bedroom in that area.
This is part of the solution Lamontnow. People like seventh floor and ddboy, among others who are the opposition need to be educated on how real estate rentals really work.
Therefore, if I am able to convince them and make them see the light that Rent Stabilization does a disservice to the public, then we have created an ally.
"The reason tenants in New York suffer under housing shortages and high rents is the fault of rent controls," said Loyola University professor Walter Block. "If politicians allowed the prices to rise, entrepreneurs would build more housing, the shortage would end, and then prices would fall. Every building that's five stories high right now would become 50 stories.
"People don't understand that prices have a role to play in signaling demand. If you short-circuit that role, you mess up the market," he added. "Rent regulations cause the whole market to fall apart. Lawmakers and tenants just don't understand the economics of the situation." Builders would start building, prices would start to fall and the market would correct itself, Block said. He predicts rents would eventually fall far below the current market rate.
What would be really interesting to know is the difference between the market rate rent and stabilized rent for similar apartments in the same neighborhood. Is it pretty much the same in some neighborhoods, while quite divided in others?
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