- REAL ESTATE EDUCATION
- GIVING BACK
New Report Shows Limiting Density Raises Rents
September 12, 2018
There is perhaps no better sign of New York City’s continued prosperity than the fact that 60,000 newcomers move to our great city each year. Experts project that by 2040 New York City will be the home of 9 million citizens. That growth is exactly why Mayor de Blasio and members of the City Council have prioritized rezoning neighborhoods to increase density and add to our housing stock – without it, neighborhoods will continue to see rising rents.
A recent report from StreetEasy underscores why the Real Estate Board of New York is so supportive of these initiatives. The report examined the change in rent neighborhood-by-neighborhood since 2010 and found that while rents had risen in many neighborhoods, rents rose higher in neighborhoods where there have been spirited attempts to limit density.
Consider this fact: seven of the ten neighborhoods that experienced the highest rent growth in the period were “at least partially downzoned to limit the height and density of future development …and that preservation has come at the cost of fixing supply in areas while demand continues to grow, thus pushing rents higher. The report even went so far to say that its “analysis suggests that rents in upzoned areas tend to rise at slower rates than areas without new developments.”
In other words, the efforts of Not In My Back Yard (NIMBY) opponents of development across the city to block strategic upzonings have done little but increase pressure on a limited housing supply and thus, increase neighborhood rents.
The practical and policy implications of this report and its findings are clear. As New York City continues to grow in population – and the consensus is nearly unanimous that this growth will continue – it is simply good public policy to advocate for more upzonings. We need to build housing for our city’s longtime residents to call home and we need to build for the newcomers.
In the past few years, we have made progress thanks to the focused efforts by local government to implement rezonings in East New York, East Midtown, Inwood, and Jerome Avenue. Each of these will contribute more housing to neighborhoods starved for new apartments, ensure that those apartments are affordable, and even preserve thousands of existing affordable units.
As a result, New York City reached record levels of new affordable housing production.
However, the reality is that the trends like those outlined in StreetEasy’s report signal that this progress is not enough to support our ever-growing population. We need to continue to focus on building enough housing to meet demand at all income levels in every neighborhood.
New York is the place everyone wants to be. That is, after all, why we all call it home. But without development spurred by transit-focused rezonings in areas that need more housing, we will only continue to put pressure on our existing housing shortage. The good news is that the report showed a clear way out of this crisis, but we must be willing to overcome the misguided opposition to development across the five boroughs that will allow our great city to continue to grow and thrive.