Rent Board Grants Preliminary OK To Hikes Up To 5%, Landlords Slam ‘Broken’ Process

The Rent Guidelines Board’s preliminary vote Tuesday night approved rent increases of up to 7% on stabilized apartments in New York City as council members and advocates disrupted the meeting in protest.

The board approved a maximum increase of between 2% and 5% on one-year leases and between 4% and 7% on two-year leases. The meeting was descended on by tenant supporters, some of whom jumped onto the stage to chant “Rent rollback! Rent rollback!” The City reported. Council members were amid the protesters, per the publication.

“I want to be clear that a seven-percent rent increase is clearly beyond what renters can afford and what I feel is appropriate this year. I recognize that property owners face growing challenges maintaining their buildings and accessing financing to make repairs; at the same time, we simply cannot put tenants in a position where they can’t afford to make rent,” Mayor Eric Adams said in a statement.

“I hope [RGB members] will look at options below the top of these preliminary ranges to strike the right balance to keep New Yorkers in their homes while providing building owners with the resources they need to provide safe, high-quality homes.”

The hike, which will go to a final vote next month, would be the biggest in a decade. 

In March, the RGB released its 2023 Income & Expense Report showing the net operating income of New York's rent-stabilized buildings dropped by nearly 14% between 2016 and 2021 driven by the pandemic and rent reform.

It also showed NOI fell by over 9% in 2021 from 2020, the largest one-year fall in the history of the data, breaking the previous record from 2002 after 9/11.

“It is clear that this process is broken. Setting reasonable rent adjustments that will maintain affordability and the quality of roughly a million apartments should be determined by professionals and data and not the farcical display that happened this evening,” Jay Martin, executive director of the Community Housing Improvement Program, said in a statement Tuesday night.

“It does not come close to covering the rising costs in rent-stabilized buildings. Even the highest end of these ranges will not put a penny in rent-stabilized building owners’ pockets. Every single cent of the proposed rent adjustment will go to property tax payments, maintenance, skyrocketing insurance, and mandatory upgrades to buildings.”

He said that lawmakers need to find a way lower the cost of housing, and that the group would continue to push for “property tax reform, expanding vouchers and creating a pathway for vacant units to be renovated.”

Rent in Manhattan was at an average of $5,186 per month, according to the most recent data from Douglas Elliman. A report released last week by the Fund for the City of New York found half the city’s households do not have enough money to meet housing, food and healthcare costs. Of those residents, 80% are paying more than 30% of the income on rent, per The New York Times.

The RGB’s board approved the rent increases in by a 5-4 vote, with the owners’ representatives proposing a jump of 7% to 10% on one-year leases and 11% to 14% on two-year leases. Tenant representatives wanted a rollback of 1% to a 1% increase for one-year leases, and a zero to 2% increase on two-year leases, The Real Deal reported. Last year, the board approved 3.25% and 5% increases to one- and two-year leases, respectively.