New York City Mayor Bill de Blasio has developed what he calls an affordable housing plan that will commit $8.2 billion of public funds over the next 10 years to create affordable housing that will stretch from Cypress Hills in Brooklyn all the way to the shorts of the Harlem River. The goal is to provide affordable homes to lower and middle class residents and do so in a way that will certainly change the face of New York City.
Blasio’s Affordable Housing Plan of $8.2 billion in public funds has been just the start as the Mayor hope to attract more than $30 billion in private funds as well as nearly $3 billion in state and federal money to launch this massive project. While the main focus is to provide for many new houses, some of the money will also be directed at programs to keep apartments under rent regulation as well. The overall idea is similar to what the previous mayor Michael Bloomberg had done to help grow residential housing, but this plan is on a much larger scale.
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The Implications for 2015
As announced during the State of the City address on February 3rd, 2015, the first part of the plan will start going into effect in the middle of the year. There are several steps that will start taking place which will have a big impact on the real estate scene in NYC.
Neighborhood Study: The neighborhoods of East New York, Long Island City, Flushing West, Jerome Avenue Corridor, East Harlem and the new Bay Street Corridor are being studied to see where more residential capacity can take place. This will involve rezoning of certain commercial sections in each neighborhood starting in the spring.
Independent Senior Living: Here, NYC will preserve roughly 10,000 units of senior housing with roughly $400 million in capital investment and from Section 8 vouchers. The new Senior Affordable Rental Apartments (SARA) will come on line this year.
End Veteran Homelessness: By expanding current programs, the priority is to house all homeless veterans by the end of 2015 with some perhaps living in new residential units.
Sunnyside Yards: The 200 acres available will be studied to determine the cost of new housing units, provide more open space and generally help pull together this area of Queens. The study is being launched immediately with recommendations due perhaps later this year.
However, Governor Andrew Cuomo has already stepped in to shut down this aspect of the new housing project, saying that the Sunnyside Yards will not be used for any housing project. NYC does own 44 acres of the 200+ acre property which means that some homes may be built as long as they do not disrupt the trains.
Based on similar plans that were executed in Boston and Denver, one of the potential downsides is the requirements which are made can actually dissuade developers from building new units. This is because the profit potential is reduced and the older structures being supported by lower rents, the desire to build new residential structures is greatly reduced.
Still, the implications for 2015 are that the new housing plan by Mayor de Blasio is going to go forward even if a great number of planned residential units cannot be built.