Landlord Group Sees Little Change Ahead in Rent Laws

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RSA president Joseph Strasburg

Bryan Terry/City&State

RSA president Joseph Strasburg

The elevation of Carl Heastie to the speakership of the state Assembly means rent regulations will be renewed and probably not changed much, Rent Stabilization Association President Joseph Strasburg said in a video interview with City & State last week. (Watch it here.)

“Clearly when we recognized that there was going to be a downstate speaker … we recognized that the policy consideration of keeping rent stabilization was going to happen,” Strasburg said, adding that Heastie would need to have been in place for a year or two before he could consider any reforms RSA seeks of the rent regulation system.

Rent regulations that restrict annual increases on the homes of 2.5 million residents expire June 15, and as was the case in 1993, 1997, 2003 and 2011, tenant advocates and landlord groups are gearing up for a fight over what shape the renewed regulations should take.

Tenant groups will find little solace in Strasburg’s prediction. They believe the current system of regulations is so riddled with loopholes that, unless it is reformed, it will eventually cease to exist. That’s why tenants want to end high-rent vacancy decontrol, which allows apartments to escape regulations once the monthly rent passes a threshold and there is a vacancy.

Strasburg, however, contended that vacancy decontrol is only a significant threat in Manhattan. What New Yorkers need instead of rent regulations, he said, is a rent subsidy program similar to SCRIE—the Senior Citizen Rent Increase Exemption—that would cap rents as a share of income and give property tax credits to offset the cost of that discount to landlords. “No one is prepared to tackle the third layer of politics, which is why are we protecting apartments? We should be protecting tenants, not apartments,” Strasburg, who has led the 25,000-member RSA since 1994, said.

Asked about Mayor Bill de Blasio’s discussion of “predatory landlords” in his State of the City speech, Strasburg acknowledged that there are “rotten apples” in his industry.
“You do have people who have come to New York to invest who are not committed to protecting affordable housing but are looking for a quick buck in terms of return on their investment and those are the ones who are most problematic, but they don’t represent the majority of owners in the city of New York,” he said. “It’s very easy to demonize the entire industry and I think the mayor has to be very careful how he pinpoints and goes after those who are in fact the most egregious in terms of how they deal with their tenants.”

RSA argues that its members provide much of the affordable housing the mayor wants to preserve, and they contend that moves like de Blasio’s push last year for a rent freeze by the Rent Guidelines Board—which regulates annual increases on rent-stabilized apartments—undercut the industry’s ability to maintain low-cost apartments. “If you’re going to want to preserve affordable housing in the city of New York, whether you like it or not as a progressive, you need to provide the owners with a cash flow in order to pay those expenses,” Strasburg said. “And I think that if he continues as part of his rhetoric … to advocate for zero or very low increases, then the entire affordable housing stock … becomes at risk.”

Tenant leaders argue that RSA must balance the costs landlords face against growth in tenant incomes. Though tenant earnings were stagnant during the Bloomberg years, RSA raised rents steadily; last year’s low hike was seen as giving renters some breathing room.

There is some common ground between the two poles of the rent-regs debate: RSA supports the growing movement toward providing counsel for tenants in housing court: “I think right now the practices of doing dispositions in the corridors really doesn’t help justice for both sides because what happens is the tenant comes in and says, ‘I didn’t really know what I was saying,’ and they reopen the case and then you have a further backlog.”

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This story first appeared on City & State, with which City Limits is partnering to cover crucial housing policy stories in 2015.