As the dust settles on last month's passage of the Housing Stability & Tenant Protection Act of 2019, landlords and all those involved in the NY real estate industry are grappling with how to adjust to this new reality. Some are exploring whether the new mandate is feasible for the city as a whole. Some items to keep in mind on a more macro perspective include:
- DECREASE IN REVENUE - Real Estate Property Taxes account for ~35% of the city budget. With rents either staying frozen or decreasing how will the city be able to offset this loss of revenue growth?
- LACK OF LEADERSHIP - As of April 2019, the city had 14 major department head positions to fill and its mayor is exploring a job opportunity elsewhere. How will the city be able to execute a successful repositioning of one of its most vital industries with a lack of governmental leadership?
- INCREASED SPENDING - NYC's swelling spending initiative sees no slow down in sight. How does the city expend its plan and save for a potential revenue change?
What's clearly outlined behind the legislative text is that the government is posting an "Investment Moratorium" on its housing stock.
Successfully navigating today's regulatory landscape requires successful collaboration with your tenants and a mastery of the new legislation. If you are exploring value-add business strategies or defensive strategies on how to protect your asset, please reach out to STRATCO.
to obtain a summary sheet on the new legislation.