New York's Housing Crisis Is Being Fueled by Bad Policy

0:00 Speaker 1 What’s going on in the residential Well, New York City, it’s a big city, eight and a half million people. Well, Aubany, Aubity is trying to double taxation and it’s going to affect almost everybody, a lot of people at least. Well with us today, Suzanne Miller. Nobody knows the residential market better than Suzanne Miller. Well, Suzanne Miller, tell us what

0:27 the heck is going on?

0:29 Speaker 2 John Funny. You should say that because yesterday in the mail, I was finally received my never bet against New York ability to use that as my trademark. So I am still not betting against New York. But there’s some bills that are happening right now that have actually come into the past this last two weeks that are finally concerning me.

0:48 So let’s talk about the first one. John. You see that there’s going to be twenty two billion dollars being spent over the next ten years to build four hundred thousand homes.

0:56 Speaker 1 You saw that, right, There is no twenty two billion dollars. I don’t know who’s going to be supplying the twenty two billion dollars, and I don’t think that right now, the only person that has twenty two billion dollars is the federal government. And I don’t think over the next three years when President Trump is president, that twenty two

1:16 billion is going to come in unless of the mayor and the governor and the president all agree on everything.

1:28 Speaker 2 Well, I’m glad you brought that up, because out of the twenty two billion, five point six billion is owned by the city. It’s owned by the state. It’s called Nitscher, And there’s two hundred and seventy thousand of those apartments that they’re saying out of the twenty two billion phantom billion, twenty five percent of that john they want to use

1:46 to fix those apartments. They want to use that to fix those apartments. They are the worst landlords, and they’re not the ones.

1:52 Speaker 1 New York City is the worst landlords with Nischer. You’re one hundred and ten percent right, And you know what, people they don’t tell people that thirty or forty percent, I don’t know the exact number that are not paying rent at all and they don’t get evicted. So why do you spend all this money building and fixing these

2:13 apartments when nobody pays the rent and nobody goes to jail nobody gets evicted. I don’t understand that well on that.

2:21 Speaker 2 So they say they’re doing this because there’s a housing shortage. So we’re saying we’re trying to build four hundred thousand homes two hundred sixty six thousand already on a disrepair. But what nobody’s talking about is there are probably another one hundred thousand that are sitting off the market because landlords cannot afford to put those apartments on the market.

2:38 So if they would just pay those landlords or give them some incentive to put their apartments on the market, maybe that would cut into half of this problem.

2:46 Speaker 1 Now I don’t understand that either, because they are trying to punish as many landlords as they can and there’s no return on investment. If there’s no return on investment, why should they invest.

2:58 Speaker 2 So, John, you’re man, You have all kinds of properties. If you had a tenant in an apartment that’s been there for thirty years, thirty years.

3:06 Speaker 1 By the way, I have publicly announced that I’m going to reduce my exposure, not that I’m leaving New York. I love New York and I want to help New York. But it’s stupid to put all your eggs in one basket.

3:17 Speaker 2 That makes me very sad, but it’s it’s not easy.

3:20 Speaker 1 To put it smart for the family to leave.

3:23 Speaker 2 It’s expensive to sell this big Well, moving on to what we just talked.

3:27 Speaker 1 About the next the next I was in Florida for the last a few days, and we’re going to be spending billions in Florida.

3:38 Speaker 2 So back to the housing shortage. So if we have one hundred thousand homes that are not yet on the market. If you were building a building and the place was empty for thirty years, or there was one tenant in there, what do you think it would cost to renovate that apartment in today’s market?

3:52 Speaker 1 I have no clue.

3:53 Speaker 2 Let’s say a kitchen, let’s say floors. Let’s say the price of goods sixty thousand dollars is low for to fix an apart. Do you know what you could rent those apartments on today’s rent stabilation laws? Three hundred dollars more of it a month, three hundred dollars month.

4:08 Speaker 1 Nobody’s going to spend the money.

4:09 Speaker 2 This is what’s going to happen. These apartments will not come on the market. The governments, the city’s either going.

4:14 Speaker 1 To take The problem at Albany is maybe you have nice people, but nobody’s a business person in Albany, and nobody understands that.

4:22 Speaker 2 So John, the apartments are either going to come back to the banks, which the banks don’t want them. This reminds me of what happened in what year Detroit?

4:31 Speaker 1 See what happened also in Yes, the nineteen No I say I’m older than you.

4:40 Speaker 2 Well, there’s gonna be a housing shore. There’s gonna be a This is going to be a tremendous I think that we can go into a big recession because of this. If these apartments get taken back and we really the banks are not defaulting on all these loans, these landlords are going to walk away. I think that the city wants.

4:57 Speaker 1 To take.

5:00 Speaker 2 To create allow with spiral.

5:02 Speaker 1 Unless Albany becomes smarter and New York City becomes smarter, than it’s going to create a downward cycle. The other thing, the other story I read a couple of days ago, was I hope Albany in New York City reviews ninety nine apartments for a location. Otherwise you have to give triple coupons. I mean, I’m exaggerating. In course to build

5:28 more than ninety nine apartments.

5:29 Speaker 2 Ninety nine floorishmen ninety nine apartments because of the forty five X. Yes, so what’s happening with the forty five X? I think you’re absolutely right. What has to happen is Albany and the city has to work together to make an incentive for the private developers to build and give them some tax incentives so that there’s not been a

5:47 realistic tax incentive since forty five. And it’s not working because, as you said, past ninety nine apartments, the rate of labor goes up. You have to keep them forever rent stabilized, rents affordable. So I think that if if we could come up with a new plan and we could find the private sector work with the public self sector, that

6:06 might help, and I think then we’ll be onto something. But right now it seems like they want to get rid of all the wealthy. We’re talking about Peter Terror was supposed to be up to five million. Now they’re snuck in one million, one million, four percent on one million.

6:19 That’s forty thousand dollars a year annually.

6:21 Speaker 1 They’re gonna hurt New York City, New York State big time. Because we need smarter people to sit down together between our city and our state and work things out. And I don’t understand Rebne used to have smart people on it, and I don’t know the people on it now, so I can’t. I’m not gonna criticize, but Revenue, it was

6:45 Revene’s job.

6:46 Speaker 2 They don’t have the cachet they did.

6:47 Speaker 1 John well they they yeah, but sixty percent of the contributions made in New York City and in Albany were real to stay related. So what happened.

6:58 Speaker 2 I think that you have different companies that came in and took over, and I think that what’s happened is the young kids are just they’re the ones creating all of this. They think they could just get things for free.

7:08 Nobody wants to work, Nobody wants to they want free housing, they want free buses.

7:13 Speaker 1 Well, that’s a big discussion that me and you are going to have again, the difference between immigrants that work eighty hours a week and migrants don’t want to free write. Thank you so much, Suzanne Miller, And never bet against New York. I don’t want to bet against New York.

7:27 I love New York and God bless you and God bless America. Thank you,