Is Affordable Housing A Myth?

The Lottery
Last year, Lamar Rouse, a pharmacy deliveryman from Flatbush Avenue, was looking for housing, ideally a two-bedroom apartment where he could live with his teenage son and his disabled father. They searched in Brooklyn, with no luck.
Then they saw an ad for the Bedford Park Manor on Webster Avenue, a brand-new building with affordable apartments in the Bronx.
With fingers crossed, Rouse’s 61-year-old father, Terrence Morgan, put in the application.
The good news came in January. Their name had been selected for the two-bedroom apartment. Rouse knew he and his family had been lucky to win, but he probably didn’t know just how lucky. The numbers are staggering: Nearly 50,000 people had entered the lottery that would determine who would rent the two-bedroom apartment – one of only 25 available rent-stabilized units in the building. The odds were about 1 in 2000 that Rouse and his family would be selected as tenants. Winning the Mega Millions lottery would’ve likely been easier.
The shortage of affordable housing is a chronic problem in New York City. Mayor Bill de Blasio launched his initiative, Housing New York, that promised building or preserving 200,000 additional affordable units over the next 10 years. So far, the city has produced just over 20,000. And only 8,344 of them are in the Bronx, which has the most number of homeless families in the City.
With the city’s top 1 percent earning more than a third of the city’s income, the income inequality between the richest and the poorest is getting bigger every year.
This year, the city recorded historic highs in homelessness, with 52,267 people, including more than 22,000 children living in shelters as of March. Those dispiriting numbers do not count take into account thousands of street dwellers at any given time.
The City will build or preserve 200,000 affordable units in the next ten years.
The city will build or preserve 200,000 affordable units in the next ten years.
High Demand, Low Supply
New York City’s apartment rental market is the product of a complex interplay between three different housing types: rent-stabilized, fair-market rate and subsidized. Affordable housing refers to subsidized and rent-stabilized units.
Elisabeth Rohlfing of the Housing Preservation and Development agency said the marketplace is “not meeting the needs of New Yorkers.” This goes for Rouse, his 14-year-old son and his elderly father, to say nothing of the city’s newcomers. Census data shows that around 230,000 new residents have arrived since 2010, and 600,000 more are expected by 2014.
“It’s a question of high demand and low supply,” said Radame Perez of Mastermind Ltd., a Bronx-based real estate development company. Mastermind has just finished a new project at 899 Westchester Ave. in the Bronx that received 65,000 applications for its 141 subsidized units.
For Perez, it’s simple: “We are not building fast enough. And some builders think Housing Development Corp. is not subsidizing enough.”
Developers estimate that a standard affordable unit may cost as much as $350,000 to build. Although costs are subsidized by the city, one developer said it would take investors “nearly 50 years” to see a return on their investment.
How do developers determine who can rent an affordable unit that they build? And for how much?
Housing Development Corp. sets the maximum income level for a household’s eligibility, but leaves it to the developer to set the minimum income threshold. This means that the people who need these units the most are cut when the minimum income threshold is set too high.
“They project the income level so high that people can’t even qualify,” said Barika Williams, policy director at the Association for Neighborhood and Housing Development, an umbrella movement of nearly a hundred nonprofit affordable housing organizations in the city.
In the affordable market place, where high demand hikes rent prices, it is somewhat tempting for developers to charge at or just below the market rate – even for the few affordable units they set aside in a mixed-income project.
The end result is that the rents that are officially “affordable” are still too high for many working-class New Yorkers.
Development projects like this one on East 138th include subsidized units geared for families under a certain income threshold.
Development projects such as this one on East 138th include subsidized units geared for families under a certain income threshold. 
The situation is not different for the city’s middle class, which has been slowly “vanishing” for years. Since 2000, the city has lost 58 percent of its manufacturing jobs — the bread and butter of the middle class. And those who have a job have little choice of housing; between 2002 and 2012, the median rent in the city has risen 75 percent to $1,100 a month.
The situation is most acute in the Bronx. It carries the highest rent burden of all New York City boroughs – the typical household may spend as much as 67 percent of its income to rent an apartment — and is also the poorest.
“We as society shouldn’t allow the rent of someone’s apartment to stop them from getting a prescription or being able to send their child to extra classes,” Williams said.
A Slice of Cosmopolitan New York
Rouse pays $1,400 rent for his two-bedroom subsidized apartment at Bedford Park Manor. It represents about 46 percent of the $36,000 household income threshold — at or below 60 percent of Area Median Income of $60,000 — required to qualify for affordable housing in that area.  That’s almost 15 percent more than it should be, as percentage of one’s income, to avoid being rent-burdened, and $335 more than the $1,065 low-income rent level set by Housing Development Corp. for a two-bedroom affordable unit. But in today’s real estate market, it’s beginning to look like a bargain. By comparison, a three-bedroom market-rate apartment on Grand Concourse currently rents for $2,100.
Consider what the Rouse family gets in exchange. Bedford Park Manor itself is attractive, boasting a stylish, mirrored entrance and urban must-haves such as automatic locks and security cameras. Its panoramic view of New York Botanical Garden across the street is worlds apart from the often grim reality of the rest of the Bronx.
The neighborhood, too, is a draw. Webster Avenue, where Bedford Park Manor is located, is as diverse and lively as the United Nations. On the corner of the block is the longtime Irish pub “Jolly Tinker,” not far from “Kingdom Foods African Market.” Farther up, “Great Wall Chinese” takeout competes with Mexican tacos and burritos served by “OK Mr. Pancho” down the street. “Vanity Fair Bathmart” is on one side and “Nuñez Auto Repair” on the other side of the seven-story building, and the “Dollar Shop” is squeezed in between.
“Where we lived before in Brooklyn was becoming bad,” said Rouse, who moved to Bedford Park Manor six months ago. “Our building was maintained badly. The prices and the crime were up.” He works 8 a.m. to 4 p.m., and enjoys this cosmopolitan slice of New York City. “It’s a brand-new building and very close to the shopping district. I like it.”
This convenience is also what attracted Michael Sweeny, a philosophy student at Fordham University, to Bedford Park Manor, which lies one stop away from the center of campus. His market-rate rent of $1,500 a month for a one-bedroom unit is at the high end of what residents are paying, but Sweeny says it’s “well worth it.” Besides, his parents are footing the bill, and the other option – living in a dorm – was simply unthinkable. “This way, I don’t have to share my room with anyone else,” he said.
Gentrified areas of Mott Haven/Hunts Point  in the Bronx experienced 40 percent increase in rents in the past decade.
Gentrified areas of Mott Haven/Hunts Point in the Bronx experienced 40 percent increase in rents in the past decade.
A Facelift
One solution to housing shortage is to encourage housing development through rezoning of former industrial areas and unused retail corridors. This is what Mayor de Blasio has done. A recent example is the new neighborhood of Cromwell-Jerome, the 57-block valley between the Grand Concourse and Highbridge in the Bronx.
“The neighborhood here needs housing for its low- to moderate-income residents,” said Shawn Brede, the Bronx deputy director of the Department of City Planning. According to plans approved by Community Board 6, the strip of one-story shops under the elevated 4 train, such as auto-shops and other light industrial enterprises, will be developed for high-density, mixed-income residential development and retail.
“Clean streets and nicely decorated properties attract more business and jobs. It’s a ‘facelift,’” said Dr. Bola Omotosho, the Community Board 5 Chairman.
What Dr. Omotosho calls “a facelift,” others might call gentrification.
Developers are indeed zooming in on the Bronx. Gone are the days when the borough conjured up images of urban decay and “the Bronx is burning” taglines of the late 1970s. Former industrial areas in neighborhoods such as Melrose, Mott Haven and Port Morris are being developed at a frantic pace.
The Department of Buildings issued 759 permits for new residential units in the Bronx in a single month alone in June.
Belmont Commons on E. 188th Street is a new development opened last month by the South Bronx Overall Economic Development Corporation, and has 40 affordable units within walking distance of Third and Webster avenues not far from Bedford Park Manor.
Halstead real estate broker Lester Rivera deals with properties on Grand Concourse – a once-elegant boulevard with Art Deco buildings, known to some as the Champs-Elysées of the Bronx.
He says other neighborhoods of the Bronx are also benefiting from the interest in the borough’s newfound fame. In fact, Rivera said, he’s begun to notice something that used to be seen only in Manhattan and Brooklyn: competition.
“People who are starting a family, first-time buyers, investors who see the future, or those who simply find Harlem overpriced think the Bronx offers a lot of value at the best price now,” Rivera said. He has recently seen potential renters coming to an open viewing with photocopied documents and checkbook in hand to rent on the spot.
Bruckner Avenue is home to hip art galleries, bars and restaurants.
Bruckner Boulevard is home to hip art galleries, bars and restaurants.
Sign of Changing Times
Nowadays, Bruckner Boulevard in Mott Haven is getting lots of attention with its Clocktower building, where a two-bedroom currently rents for around $2,000, fetching the highest rents in the borough. Mott Haven Bar & Grill, a hip eatery at 1 Bruckner Blvd., offer specialties like quinoa black bean burger and sushi Latino. Good transportation links to Manhattan via 4, 5 and 6 subway lines make the area desirable among people priced out of Manhattan and other boroughs.
Despite the good intentions, new development initiatives may have to knit together new and existing communities; and sometimes the tensions manifest in strange ways. Last year, a kiosk across from an office building on Fordham Road was allegedly barred from serving buttered rolls and cheap cups of java. It seems the management was protecting its newest tenant, a Starbucks.
Other heavyweight brands that joined the race to open stores include Old Navy, The Gap and Planet Fitness, and two new boutique hotels along the Third Avenue strip that form the Hub — the retail, theater and restaurant heart of South Bronx.
Filtered Bronx, a boutique coffee shop, is soon to open a branch on Third Avenue, Mott Haven.
Filtered, a coffee chain, is soon to open a branch on Third Avenue, Mott Haven, which will aptly be named Filtered Bronx.
“We’re in a really interesting and precarious position right now in the Bronx. We’re looked at as the ‘last frontier’ by some, and that can be very dangerous, particularly for our low-income residents,” said Lisa Gomez, 25, who has been living in the Bronx for more than 20 years and runs the blog The Bronx Socialite.
“Affluent people move in, affordable housing people go out. But you want people to stay,” said Joseph J. Salvo, director of the population division of NYC Planning Department.
Salvo’s and Gomez’s fears that residents of the Bronx may soon find themselves priced out in the development boom aren’t unfounded.  A report published in April this year by New York City Comptroller Scott Stringer, titled “The Growing Gap: New York City’s Housing Affordability Challenge,” affirms that between 2000 and 2012, real average rents increased by 40 percent in Mott Haven/Hunts Point in the Bronx. Across the city, the situation is even more stark: In the same period, rent increases resulted in the loss of 400,000 affordable apartments in New York City.
In June, the new Rent Law by Rent Guidelines Board went into effect. It moved the cap for rent-stabilized units — that elusive form of affordable housing — from $2,500 to $2,700 a month, and by doing so, released thousands more properties to unregulated market, adding to the units lost of this important type of affordable housing.
Two years on from the Mayor’s promise of equality in New York, the city of dreams and glitz is still sharply divided on the housing front.