I’ve been listening to New York City Deputy Mayor Alicia Glen on the radio, explaining the de Blasio administration’s recently announced program for affordable housing, and it’s stirring to hear someone speaking with passion and intelligence about progressive urbanism. I’ve also been wading through a copy of the plan itself, and while moved by its rhetoric and reach, I must admit that the more I read it, the more opaque it gets.
The good news is that the numbers are big, the plan embraces a wide variety of interventions, and “affordability” is being defined to embrace the truly poor. The mayor proposes to “build or preserve” nearly 200,000 units (housing about a half-million people) over the next ten years and touts the initiative as “the largest and most ambitious affordable housing program initiated by any city in this country in the history of the United States.” That may be, but it’s tragic—and typical—that the burden of producing affordable housing falls so heavily on the city. And given that 73 percent of the financing is to consist of private capital, there’s the $41 billion question of whether the menu of inducements in the plan will be found sufficiently appetizing.
The largest and most ambitious affordable housing programs in the history of the United States were financed by Washington through the loan policies of the Federal Housing Administration (largely directed toward suburban development, which was also stimulated by massive federal investment in highways and other infrastructure) and by the 1949 National Housing Act, which empowered local authorities to administer federal funds for low-income rental housing. Cities got the short end of the stick: the feds spent more than fifteen times as much on the suburbs as they did on urban projects. The New York City Housing Authority (NYCHA)—the most successful public housing agency in the country by almost any measure—was the city’s vehicle for channeling this assistance, and it built over 180,000 units, most of which were constructed in the two decades following World War II (during which Washington facilitated the construction of more than 2 million units for defense workers around the country). To put the urgency behind this number in perspective, the private Stuyvesant Town development on Manhattan’s East River waterfront had received 200,000 applications for 8,757 rental units by the time it opened in 1947.
To achieve his goal, Mayor de Blasio proposes to preserve 120,000 existing units and build 80,000 new ones. But how many of these apartments will be truly and permanently affordable? The answer depends on two issues: first, how “affordability” is defined, and second, how best to institutionalize it. The first calculation is based on the relationship between rents and area median income (AMI), with affordable-housing costs generally defined as requiring less than 30 percent of income. This creates a structure of differential affordabilities that the city breaks out into five bands, ranging from “extremely low” to “middle” income. The crisis is acute at all levels: the city’s own numbers suggest a dramatically widening gap between incomes and rents and a rise in households that are “severely rent-burdened”: close to 30 percent of New Yorkers pay more than 50 percent of their income for housing. There are close to 1 million renter households in the city with either “very low” or “extremely low” incomes, but there are fewer than half that number of apartments available to them. And the city has at least another 50,000 people homeless.