Progressives’ ‘good cause eviction’ bill spells doom for NYC housing

It’s hard to imagine making New York City’s housing market even worse, but the progressives in charge of the Legislature aim to do just that.

The city has more public and subsidized “affordable” housing (both in total and per capita) than any other — yet it’s in a perennial housing crisis. Nearly a million apartments are “rent-stabilized” — under a regime so onerous and discouraging of investment that some 60,000 are just being left vacant by their owners, rather than lose money on them.

Nor is there a way up and out for squeezed tenants: Thanks to zoning and NIMBY-ism, New York state as a whole has built less new housing than even other Northeastern states, let alone Texas and Florida.

Now the progressives want to distort this housing “market” even more.

Their “good cause eviction” proposal threatens to discourage new housing and drive existing landlords out of the business altogether.

That would probably please the bill’s sponsor, state Sen. Julia Salazar of Brooklyn, a proud Democratic Socialist.

But she’s far from alone: Both the Assembly and state Senate proposed budgets include the idea. 

Kathy Hochul
Kathy Hochul has pushed for more housing developments in suburban areas.
Mike Groll/Office of Governor Kathy Hochul

Obvious good causes for eviction include not paying the rent, or causing disturbances.

But that’s not what the “good cause” bill has in mind. It would prohibit evictions if rents become “unreasonable” — specifically, raised by more than 3% or 1.5% above the Consumer Price Index, as determined once a year. 

This is statewide rent control by another name — with all the distortions it brings with it.

In a period of raging inflation, a snapshot of the Consumer Price Index may well not reflect a property owner’s rising costs over the course of the year. Not that progressives are concerned about the costs of the numerous small, “mom and pop” landlords, many of whom are new immigrants using property ownership to aid their upward mobility.

A 2019 law barred rent increases in regulated units even if owners have to make major capital repairs.

The cost of a new roof must come out of their profits — even if they have none.

That’s why units are being left vacant.

More broadly, controlling rents suppresses price signals, the means through which supply and demand are balanced.

It encourages tenants to stay longer in apartments larger than what they might need — limiting the turnover that a healthy market needs.

That’s why you can find aging Baby Boomers knocking around in Upper West Side apartments with empty bedrooms, while young New Yorkers are doubled up in shoeboxes.

Julia Salazar
Julia Salazar’s bill would ban landlords from evicting tenants without “good cause.”
Paul Martinka

New York University’s Furman Center has found that rent-regulated tenants remain in their units three times as long as those in non-regulated units — and are better off, as well. 

Rent limits are also why there are long waiting lists for public housing units; more than a quarter of current tenants are “overhoused”— meaning they, too, have more bedrooms than they need.

Housing “advocates” believe we should effectively transfer property rights from owners to tenants and let the latter stay put as long as they’d like — and even pass along their apartment to younger family members.

Their model is the city’s dilapidated public-housing system, where tens of thousands of residents have lived in their units for more than 40 years. 

Salazar and her fellow travelers have a dread of gentrification — the wealthier driving out the poor from the Brooklyn neighborhoods she represents.

Reality check: There are a limited number of hedge fund managers even in New York, and lots of them are following Citadel’s Ken Griffin to Miami, as New York has apparently made “tax the rich” its official state slogan.

Moreover, property owners in many parts of the state — think depressed Syracuse, Rochester or Utica — are not likely to be keen to evict a tenant having trouble paying the rent; there may not be another one ready to move in. 

Gov. Kathy Hochul, to her credit, has promoted the idea of new housing construction in New York’s suburbs — a good way to lower prices when so many state residents are fleeing and the population has fallen.

Ken Griffin
Ken Griffin led the charge for wealthy New Yorkers to move down to Florida.
Getty Images

But she pushed an idea guaranteed to inspire maximum resistance — a state super-zoning board that could override local decisions.

That’s predictably inspired pushback. She needs to find the right mix of incentives to persuade, rather than coerce — a challenge for tight housing markets across the country. 

To her discredit, Hochul might cave to the Legislature and sign a budget that includes “good cause eviction” regulation to get the rest of her plan passed, too.

Florida Gov. Ron DeSantis will seek the presidency on the basis of what he’s done to make his state a magnet for newcomers.

Meanwhile, Empire State lawmakers are doing all they can to make their state ever less attractive.

Howard Husock is an American Enterprise Institute senior fellow.

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