With studios going for $1775 a month, one-bedrooms that rent for $2240, and a median rental rate for 2-bedrooms that’s gone up 16% in the past year, you may have wondered at some point why rent in Bushwick is skyrocketing. The answer is a complex one that involves many factors– and it goes far beyond the greed of wealthy developers and the basic principles of capitalism. It is no secret that there are a lot of people moving (or trying to move) to Bushwick (which makes a lot of sense to Bushwick Daily, since, as you know, we’re generally of the opinion that this is a great neighborhood) and, obviously, there simply aren’t enough apartments to supply the demand. But rent rates in New York City are also directly influenced by high property values, high construction expenses and astronomical property taxes. Add the presence of a vibrant local creative community, like we have in Bushwick (and consider its proximity to the real estate cash cow that is Williamsburg), and the result is a neighborhood that currently boasts one of the biggest rent spikes in the city.
NYC is a very desirable place to live, and there’s a limited amount of space here–which can’t be increased, while population can increase, and does, exponentially. It’s also a very expensive place to be the party who bottom-lines the creation and maintenance of a building. Construction costs currently clock in around $280 per square foot (for reference, the average studio apartment is around 500-600 square feet); if that seems like a lot, think about the all of the people whose professional expertise and labor is required to build or renovate housing. And don’t forget to add the financing costs, because the banks that enable this kind of project will always take a sizeable financial cut. But expensive land and construction costs are standard issues in many other cities; what makes New York’s rent market unusual is the high property taxes charged to apartment buildings, which are among the highest in the country. As Josh Barro reports for Business Insider, New York’s tax system features a bizarre policy in which any apartment building where the owner is not an occupant and that has three or more rental units gets slapped with a hefty tax of its own. This burden often ends up falling on tenants in the form of high rent– which would already be high if the landlord had incurred major expenses purchasing the property and constructing or renovating the building.
So, now we know more or less why rent is so damn high in this city in general, let’s take a look at the hype that makes Bushwick’s case special. Bushwick is, of course, like no other up-and-coming neighborhood in the city because of its arts community. Other epicenters of urban development and transformation (a.k.a. gentrification) in the city, like Harlem or Crown Heights, don’t have the kind of cultural cachet that Bushwick has. New coffee shops and restaurants can pop up anywhere where young professionals are moving in, but before the current wave of craft beer shops and pet stores hit our neighborhood, many artists had already put down roots here, establishing studios, performance spaces and art galleries. This neighborhood identity operates conveniently as a brand in the media and in real estate contexts, allowing new developers and old landlords to profit off of the dopeness– which we’re all hoping will avoid colonialist rhetoric and come to pass in ways that involve minimal (or ideally, no) displacement of long-time neighborhood residents, incorporate environmentally sustainable building techniques, and establish some innovative architectural landmarks in the area.
Coming up with blueprints for balanced urban renewal in Bushwick in which neighborhood and housing improvements don’t end up pricing locals out is a task big enough for a doctoral thesis, but in the meantime there are a few things we can do at the grassroots level while some poor grad student tackles those issues. Putting pressure on the city government to reform the tax system could help create a new tax system that incentivizes landlords to establish and sustain accessible rent prices, since overtaxing apartment buildings directly contributes to the fact that one-third of New Yorkers spend almost half their income in rent. A better tax structure could also promote the development of more affordable housing (and reduce interest in building luxury rentals), and it would allow for a rent control system that actually works, as evidence suggest that the city’s current rent control model actually operates against the long-term success of affordable housing programs.
Traditionally, policy changes that would streamline the approval process for affordable housing, allowing more housing to be built, could relieve some of the fierce competition for housing. To accomplish this, it may make sense to reevaluate some of the city’s zoning regulations, which currently restrict denser neighborhoods and include lots of provisions for parking space. One zoning change in particular would be especially beneficial for Bushwick: allowing artists to form cooperatives and transform industrial and commercial buildings into live-work spaces, which is currently forbidden in districts zoned only for industrial use, like Bushwick’s north-west and south-east borders. Additionally, these zoning changes could be extremely effective if accompanied by some changes to the development financing system that would allow for more government loans aimed at smaller and nonprofit developers, such as community development corporations. These institutions are legally required to put their profits back into the buildings and community they’re built in, which keeps rents affordable, allows for hard-working building staff to receive better wages, and contributes to the development of strong civic infrastructure through projects like community gardens and after-school programs.
Some community-based solutions that can curb the rising prices of rent include networking to create a strong community of tenants and homeowners, talking to your neighbors, discussing issues that affect all groups of residents, reporting abusive landlords, going to community board meetings and finding out what is going on with the zoning regulations in your hood. Also, if you rent, be a good tenant: try to stay put for more than the period of your lease, take good care of your apartment, and take initiative with your home repairs and small home improvement projects (while communicating about it with your landlord to see if you can get discounts in rent). And do your best to avoid living situations where a recent gut renovation has led to a spike in rent!
So there you have it- one architect’s suggestions for ways that both policymakers and the public can collaborate to keep Bushwick affordable.Related 2013-10-30