According to the report released by the non-profit organization Fiscal Policy Institute on November 14th, the housing crisis in New York City continues to worsen, currently more severe than ever before. Rents in all five boroughs of the city continue to skyrocket, with the rate of increase 57% faster than the growth in tenants’ incomes.
From 2019 to 2023, the median rent across the city increased by 18%, while incomes only rose by 11.5%. This means that over the four-year period, the cost of renting has been rising 57% faster than income growth.
Even for homeowners, the maintenance costs of housing increased by 11.6% during this four-year period, while incomes only grew by 9.8%. The rising speed of housing costs still outpaces income growth by 18%. The inability to afford housing has become the primary reason for families leaving New York City, with 546,000 people moving out in the past four years, of which 36% cited housing costs as the main reason, compared to only 16% before the pandemic. The increasing housing costs lead to population outflow, further impede job growth, weaken the government’s tax base, and create a vicious cycle.
In response to this, Mayor Adams of New York City proposed the “City of Yes” plan, aiming to construct 100,000 new housing units by 2039 through easing land use restrictions. While the plan was expected to be voted on by the City Council Committee on November 21st after revisions, the updated version excludes the relaxation of land use restrictions in low-density areas, meaning only about 80,000 new housing units are estimated to be built.
Even with the potential addition of 80,000 new housing units, the Fiscal Policy Institute report highlights that the issue of affordability remains unresolved. The report emphasizes that the government needs to increase investment in affordable housing and strengthen tenant protections to alleviate the housing crisis.