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from Post Editorial Board – New York Post.
July 10, 2020 | 8:57pm
Market rents are actually falling in many areas of the city, and vacancy rates rising.
Count the city’s housing market as another casualty of the pandemic and the lockdown; the only real question is how deep the damage will go.
With roughly 700,000 renters thrown out of work and evictions banned for the interim, a full quarter of tenants have gone four months without paying rent, Bloomberg Businessweek reports. They’re still on the hook for it, though — often with no idea how they can ever pay.
And that’s left many landlords unable to cover all their bills, such as the property-tax payments that were due July 1. But other bills — for utilities, repairs, supers and other staff — can’t be postponed.
The Community Housing Improvement Program, a group representing mostly smaller landlords of rent-stabilized buildings, estimates that 20 percent of its members are in distress and may have to sell properties to stay afloat.
But it’ll be at fire-sale prices, since the crisis has exposed new risks to owning a city apartment building — and to living in one: Market rents are actually falling in many areas, and vacancy rates rising.
Those who own their homes are mainly in better shape, though they may miss a mortgage payment or two: It’s the nature of that market that they have more assets to get through tough times.
Still, some will have to refinance or sell completely — at a time when those prices have dropped, too.
But it’s the rental market that’s the real problem — uniquely so for New York City, about two-thirds of whose residents rent, far above the national average.
It doesn’t help that City Hall seems clueless, even insisting on a harsh 18 percent charge on late property-tax payments. Nor does it realize how badly that revenue source could be hit for years to come.
Some neighborhoods risk a repeat of the 1970s, when landlords walked away from their buildings as rent rolls didn’t meet expenses — and a few resorted to arson.
Getting the local economy moving again will help some, but city and state lawmakers need to focus fast on how to heal the damage, before it gets worse.
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Michael Novakhov – SharedNewsLinks℠