Frank Braconi points out that New York’s in rem housing policy holds semblance to no other in the country. Beginning in the 1970s, the program was intended to be a temporary solution in light of disinvestment and abandonment. However, new tax policies and changes in demographics forced the City to continue standing in the gap. When disposition programs finally commenced, there was huge controversy over who should acquire the City’s large portfolio of abandoned buildings.
The origin of in rem housing lies directly in abandonment and disinvestment of buildings by working class whites. When these middle income families moved out of inner city neighborhoods into more appealing housing, they sparked the deterioration of buildings they left behind. With the wealthier families moving out, remaining residents were typically those who struggled to find jobs and pay the rent. Hence, buildings lost their best tenants and in the face of rising cost, could not afford proper maintenance. The city anticipated problems but only made them worse by altering the tax code. As a result, those who were delinquent in their payments for a single year were evicted, causing more abandonment. With the problem spiraling out of control, the City had no choice but to acquire the troubled buildings for the time being.
Although the program was intended to be temporary, problems persisted and the City found itself in the business of managing properties. Personally, I think the Housing Preservation Department was very efficient in their approach. They focused on consolidating housing and managed to increase occupancy from 40% to 85% while getting rid of 1900 buildings. In addition, they enacted rent regulation policies and cut costs by contracting maintenance jobs. Hence, while it was not their intention to manage housing, the City seemed surprisingly effective in handling them.
When the time came to dispose of the City’s huge housing portfolio, there was controversy over whether ownership should belong to tenants, nonprofits, or private parties. Tenant ownership seemed to foster low rent and anti-landlord rhetoric, both of which were bad for maintaining a building. The local nonprofit ownership appealed to many, but it proved to reveal no clear cost efficiencies. Nonprofits were found to set initial rents too low and as a result, struggled to make up their costs. The final and most controversial disposition program supported private ownership. Activists were outspoken against these parties, citing gentrification and the incompatibility of profit making and low-income housing. With such controversy circling disposition programs, it took until the Guiliani administration before the City could substantially deplete its in rem housing.
Hence, the longevity of New York’s in rem housing distinguishes it from any other city across the country. In the face of disinvestment and abandonment, the City managed to effectively consolidate housing and sap up tax revenue. Nonetheless, the program’s continuation (and even its end) stirred controversy and discontent from all groups, making it a burden to the City.
