Rent Guidelines Board's recommended stabilized rent hikes: too high for tenants, too low for landlords
FILE - Residential apartment buildings are seen on July 26, 2022, in New York City. (Spencer Platt/Getty Images)
Rent hike worries turned a heated meeting Tuesday night into a rally before the Rent Guidelines Board voted to recommend a rent hike for more than a million stabilized apartments across New York City.
The board, which consists of nine members, recommended increasing 1-year leases from 2% to 5% and 2-year leases 4% to 7%.
"That’s why a lot of people move out of New York. They go to Atlanta or go to New Jersey because rent is cheap," one New Yorker told FOX 5 New York.
It’s not a cheap city to live in and talks of raising rent even higher raises eyebrows, unless you're Michael Tobman, who sees it as a must.
"It does not allow building owners to keep up with ever-increasing costs," said Tobman, the Rent Stabilization Association’s membership director.
He speaks for 26,000 landlords where many of the properties they own or manage are either approaching or are more than a century old.
"All of these old buildings require steady maintenance, from hallways and electrical plumbing and elevators, all of that takes money," Tobman said.
It’s money he suggests owners and property managers are scrambling to find amid historic inflation rates.
From 2021 to now, the Department of Finance reported real estate taxes rose by 7.7%, fuel and insurance costs rose by nearly 20% and 13% and maintenance costs increased nearly 10%.
RSA members feel those inflated rates aren't accounted for in the Rent Guidelines Board's recommendation.
He sees the ultimate cost of that recommendation as far more expensive down the line.
"We’re going to see disinvestment in buildings. We’re going to see work not getting done. We’re going to see buildings unable to meet higher costs of refinancing," said Tobman.
The board will hold a final vote on June 21.