Housing NYC 1996

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Housing NYC 1996 HHOUSINGOUSING NYCNYC Rents, Markets and Trends ‘96 A Compilation of Rent Guidelines Board Research BOARD MEMBERS Chairman: Edward Hochman Public Members: Earl Andrews Paul Atanasio Elissa Fitzig Agustin Rivera Owner Members: Joseph L. Forstadt Harold A. Lubell Tenant Members: Leslie Holmes Kenneth Rosenfeld STAFF Executive Director: Douglas Hillstrom Research Associates: Edwin Fields Sharon Kuhn Andrew McLaughlin Public Information: Cecille Latty Office Manager: Leon Klein Research Assistant: Miriam Greenwald NYC Rent Guidelines Board 51 Chambers St., Rm. 202 New York,NY 10007 http://www.nycrgb.com TABLE OF CONTENTS A Letter from the Chairman..............................................v Longitudinal Study Acknowledgments ..............................................................xv Lending Standards ....................................54 Non-Performing and Delinquent Loans....55 State of the Rental Market ‘96 Respondents.............................................55 Landlords’ Operating and Conclusion ...............................................55 Maintenance Expenses.................................17 Retrospective of the Mortgage Rents ............................................................18 Lending Market O&M-to-Income Ratios .................................20 Secondary Lending Market.......................55 Tenant Income and Housing Affordability....20 Lending Market Trends Since 1980 ..........56 INCOME AND EXPENSE 1996 Tax Arrears Study Summary .........................................................58 1996 Price Indices of Operating Costs Introduction....................................................58 Summary ......................................................25 Buildings in Arrears .........................................58 Introduction .................................................25 Level of Arrears ...............................................59 Rent Stabilized Apartments Foreclosures....................................................60 Price Index Components .........................27 Rent Stabilized Hotels .....................................33 INCOME AND AFFORDABILITY Rent Stabilized Lofts........................................33 1996-1997 PIOC Projections 1996 Income and Affordability Study Summary ..................................................34 Summary .........................................................62 Components.............................................34 Introduction....................................................62 Commensurate Rent Increase.........................37 Household Income..........................................62 Level of Employment ......................................64 1996 Income and Expense Study Unemployment ...............................................65 Summary .........................................................39 Rents ...............................................................66 Local Law 63 ...................................................39 Rent-to-Income Ratios Methodology...................................................40 New York City ..........................................66 Cross Sectional Study Other Cities..............................................66 Rents ........................................................41 Housing Court.................................................68 Operating Costs........................................42 Public Benefits ................................................69 Components of Operating Costs..............43 Operating Cost Ratios ..............................44 HOUSING SUPPLY “Distressed”Buildings ..............................45 Longitudinal Study 1996 Housing Supply Report Rents ........................................................45 Summary .........................................................74 Operating Costs........................................47 Introduction....................................................74 Operating Cost Ratios ..............................48 NYC’s Housing Inventory ...............................75 Tax Commission Data...............................48 NYC’s Rental Housing - Additions and Renovations .............................76 1996 Mortgage Survey Report Certificates of Occupancy........................77 Summary .........................................................49 Permits .....................................................77 421-a Tax Exemptions ..............................78 Introduction....................................................49 Conversions and Subdivisions..................78 Survey Respondents........................................49 Returned Losses .......................................79 Cross Sectional Study Rehabilitation ...........................................79 Financing Availability and Terms ..............50 Underwriting Criteria...............................51 Other Changes In New York City’s Housing Inventory Non-Performing Loans and Foreclosures ......................................52 Demolitions..............................................80 Cooperative and Condominium Activity..80 Characteristics of Rent Tax-Delinquent Properties .......................81 Stabilized Buildings ..................................52 Future Additions to NYC’s Housing Stock ......82 iii APPENDICES D.4 Housing / Neighborhood Quality Characteristics...............................112 Appendix A: Guidelines Adopted by the Board Appendix E: 1996 Mortgage Survey Report A.1 Apartments & Lofts ...................................84 E.1 Typical Characteristics of Rent Stabilized A.2 Hotel Units...............................................84 Buildings in Lenders’ Portfolios, 1996 .......116 Appendix B: Price Indices of Operating Costs 1996 E.2 Interest Rates and Terms for New and Refinanced Mortgages, 1996 ..............117 B.1 Number of Price Quotes Gathered for Each Item in the PIOC ,1995 vs.1996.........................85 E.3 Interest Rates and Terms for New Financing, Longitudinal Study ...................117 B.2 Expenditure Weights, Price Relatives, Percent Changes and Standard Errors, E.4 Lending Standards and Relinquished All Apartments, 1996 ...................................86 Rental Income, Longitudinal Study............118 B.3 Price Relatives by Building Type, E.5 Retrospective of NYC’s Housing Market ......118 Apartments, 1996........................................87 Appendix F: Tax Arrears in Rent Stabilized B.4 Percentage Change in Real Estate Buildings, 1995 Tax Sample by Borough and F.1 Tax Arrearages, Buildings Three or Source of Change, Apartments and Hotels, 1996 ..........................................88 More Quarters in Arrears, 1989-95 ............119 B.5 Tax Change by Borough and Appendix G: 1996 Income and Affordability Study Community Board,Apartments, 1996..........88 G.1 Average Real Wage Rates by Industry B.6 Expenditure Weights, Price Relatives, for NYC, 1989-94 (1989 dollars) ...............119 Percent Changes and Standard Errors, G.2 Average Nominal Wage Rates by All Hotels, 1996 ...........................................89 Industry for NYC, 1989-94 ........................120 B.7 Price Relative by Hotel Type, 1996 ..........90 G.3 Average Payroll Employment by B.8 Expenditure Weights and Industry for NYC, 1988-96 (Thousands) ...120 Price Relatives, Lofts, 1996 .........................91 G.4 Average Annual Unemployment Rates B.9 Changes in the Price Index of by Area,1988-95..........................................121 Operating Costs, Expenditure Weights and G.5 Consumer Price Index for All Urban Price Relatives,Apartments, 1986-1996.......92 Consumers, New York-Northern Appendix C: 1996 Income & Expense Study New Jersey, 1988-96 ..................................121 C.1 Cross Sectional Income and Expense Study: G.6 Housing Court Actions, 1983-95 ............122 Estimated Average Operating & Maintenance G.7 Housing Affordability – Renter Cost (1994) per Apartment per Month by Occupied Dwellings in Central Cities.......122 Building Size and Location, Structures Built Before 1947.........................................94 Appendix H: 1996 Housing Supply Report C.2 Cross Sectional Income and Expense Study: H.1 New Construction in NYC, 1960-95......123 Estimated Average Operating & Maintenance Cost (1994) per Apartment per Month by H.2 Permits Issued for Housing Building Size and Location, Structures Units in New York City, 1960-96................124 Built After 1946. ..........................................95 H.3 Number of Residential Co-op C.3 Cross Sectional Income and Expense Study: and Condominium Plans Accepted Estimated Average Rent and Income (1994) for Filing by the Attorney General's per Apartment per Month by Building Office, 1994-95 ..........................................125 Size and Location ........................................96 H.4 Number of Units In Co-op C.4 Composition of Operating Costs in and Condominium Plans Accepted 1994 by Building Size and Age ....................97 for Filing by the Attorney General's Office, 1981-95 ..........................................125 C.5 Cross Sectional Sample, 1995 RPIE Filings..............................................97 H.5 Tax Incentive Programs .........................126 Appendix D: 1993 Housing and Vacancy Survey H.6 Tax Incentive Programs - Units Receiving Initial Benefits, 1981-1995.........126 D.1 Occupancy Status....................................98 H.7 City-Owned Properties, 1985-1996 .......127 D.2 Economic Characteristics......................100 H.8 Apartments Demolished in D.3
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