On June 21, 2023, the Rent Guidelines Board preliminarily approved rent increases that fall below landlord operating costs, risking severe repercussions for New York's housing market. The proposed increases, at 1.75% to 4.75% for one-year leases and 4.75% to 7.75% for two-year ones, will not sufficiently compensate landlords facing rising costs in various areas such as insurance and energy. The financial distress may lead to landlords selling buildings or neglecting maintenance, adversely impacting tenants and ultimately exacerbating the affordable housing crisis.
The Rent Guidelines Board's recent approval of below-cost rent increases is likely to lead to greater financial strain for landlords and fewer available rental units.
Between rising insurance, energy, and tax costs, landlords are facing insurmountable financial pressures while being limited by government regulations on rent increases.
Over the past decade, the disparity between skyrocketing costs and capped rent increases has left many buildings unsustainable, which could potentially lead to a housing crisis.
New laws aimed at climate change and additional governmental restrictions are compounding financial hardships for property owners, driving more units into vacancy rather than rehabilitation.
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