As America’s housing affordability crisis continues, New York and other cities are taking steps to address the problem. I recently was interviewed about New York City’s approach by Bruce Cory for Urban Matters of the New School’s Center for New York City Affairs, an outlet for policy debate. Here are edited excerpts; you can read the full two-part interview here and here, and you should check out the other great work the Center is doing.
Urban Matters: “The greatest city in the world has just passed the greatest housing legislation in our history.” That’s how Mayor Eric Adams…characterized the New York City Council’s approval of his “City of Yes” zoning overhaul. Just how big a deal is this?
Richard McGahey: With its sights set on developing 80,000 new housing units over the next 15 years, “City of Yes” is simultaneously a big deal and also inadequate for addressing the city’s housing supply and affordability gaps.
On the plus side, the City Council supported significant zoning changes that should lead to more housing construction, which in turn will help affordability through increasing supply. On the minus side, the plan was scaled back to accommodate single-family housing, cut development options near transit sites, keep too much parking, reduce combined commercial-residential projects, and over-regulate other housing options.
UM: The City of Yes rezoning took some fairly small ideas…and bundled them into one package intended to create “a little more housing in every neighborhood.” Have we now run through these kinds of options?
McGahey: Hopefully, we will restore some of the anti-housing steps negotiated with the Council. Estimates are those policy changes will cut the housing units from the City of Yes by 26,000 units, almost 25 percent of the original projections…Other things would help, including speeding up project approvals while reducing delays caused by excessive procedures and reviews.
UM: Let’s step back for a minute: With people giving up on New York because of housing costs, is what we have here still just a matter of thinking too small?
Take the City of Yes goal of 80,000 new housing units in the next 15 years – and then top that up with as much as another 100,000 Manhattan units. New York City created nearly four times that much in the 1950s and 60s subsidized by government big-time. Now we use zoning incentives to coax more housing from private developers. Is that good enough?
McGahey: The welcome positive steps in City of Yes are not sufficient to address our long-term housing shortage. Because we failed to build enough housing for many years, we are hundreds of thousands of units below where we should be. The most recent City apartment vacancy rate was 1.4 percent, not even enough to account for frictional movement by existing renters.
We need all ways of increasing housing supply, but private markets are an essential part. City and State government are not fiscally able to make massive public housing investments. And the Trump administration is likely to reduce the nation’s already inadequate aid to cities. So allowing some incentives to private developers for creating new affordable units must be a significant part of the supply equation.
Urban Matters: You recently said that while the “City of Yes” is “a promising sign that many progressive politicians now recognize the need to increase housing supply,” pro-development momentum needs to be kept up. How?
Richard McGahey: I worry many progressives still cling to myths about housing that will block positive momentum for new construction. I was sorry to see Governor Kathy Hochul come out against private equity investments and use of rental algorithms in housing. While I’m no fan of either, they aren’t significant reasons for our housing problem, and can divert us from real solutions.
We need progressive politicians who recognize the need for private housing investment and avoiding excessive regulation while concentrating on affordability, in the face of misguided arguments that housing regulation will solve the affordability crisis.
Brooklyn’s Gowanus rezoning and neighborhood plan, which had extensive community involvement resulting in significant pro-housing policy that also should increase affordability, is a good example of what we need.
UM: Back in 2023, in your newly published book Unequal Cities, you said that, “New York’s progressives need to look to Los Angeles, where a ‘triangle’ of unions and developers, communities of color, and environmentalists worked together for progressive goals.” Is that what happened to pass City of Yes? Do you see such a coalition influencing this year’s New York City election?
McGahey: I don’t think the Los Angeles dynamic was reproduced here, although the Gowanus rezoning has some parallels, with its communication and meaningful community benefit agreements. Rather, New York’s housing crisis just can’t be denied, and the Mayor and the Council both recognized that.
A major danger in LA – and New York – is some progressives’ desire to address housing primarily through regulation and tenant rights, while downplaying or rejecting increased supply. That could be an Achilles heel for housing, and for progressive coalitions.
UM: Recently, a column by New York Times editorial writer Binyamin Applebaum argued that Donald Trump won last November, in part, because voters saw homelessness and the housing affordability crisis in cities like New York as proof that Democrats just aren’t up to the job of governing. Do Democrats have to own that judgment?
McGahey: Democrats have gone too far in creating excessive, uncoordinated layers of regulation, project review, and “community” input which often is dominated by wealthier single-family homeowners. In contrast, organizations like Open New York combine support for tenants with increasing housing supply, and that’s the kind of work we need. The solution isn’t unrestrained housing development. Without reforming single-family zoning and overcoming suburban economic and racially-based resistance to denser affordable housing, low-density suburban sprawl just unfairly burdens cities alone to solve regional housing problems.
UM: Final question. Just last January, Alex Schwartz, who chairs the graduate program in public and urban policy at The New School’s Milano School, told Urban Matters: “People in poverty simply cannot afford the basic cost of operating a housing unit. If rents only covered insurance, taxes, utilities, management, repairs, and other essential costs, and generated zero profit for the owner, they would still be unaffordable.” What does City of Yes, and increasing housing supply, do to reduce that problem?
McGahey: Alex is right. City of Yes does not primarily address the massive problem of economic inequality – in New York and America – which also has deep racial and ethnic bias built into it. Even with increased housing supply, which will help slow and even reduce housing costs, too many people don’t have enough income for a decent standard of living.
Addressing income inequality requires a multifaceted strategy and will ultimately require a national movement. Progressives shouldn’t block good housweNing policy – like City of Yes, with all its shortcomings,– because it doesn’t solve the larger problem of America’s deeply rooted, multidimensional, racially biased economic inequality. Progressives should support City of Yes and other efforts to increase New York’s housing supply, including market-rate construction, across the board.
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