Plans to turn half-finished or largely empty new luxury condo buildings into affordable housing are coming fast and furious. First we got the City Council's HARP proposal, then a State Assemblyman laid out his vision for Brooklyn's bad boys, and now the New York State Housing Finance Agency is getting into the game. But here's the rub: There is no precedent for any such program, and no one is sure if they can, or will, work. The concerns seem fairly valid. Appraiser Jonathan Miller wonders what the impact on property values will be, while Manhattan Mortgage's Melissa Cohn tells the Times, "It's very hard, in a building that is 30 percent sold and closed, to designate the balance of the building affordable housing The costs of carrying a building doesn't change. Do you get rid of the doorman? Eliminate the gym? Close down the party room?" Party pooper! Let's give the NYSHFA a chance to win us over regarding its developer bailout, shall we?
It's more of a moderate-income thing, the Times explains:
Priscilla Almodovar, chief executive of the New York State Housing Finance Agency, said that a plan now in its early stages would most likely include offering homebuyers state-financed mortgages for units in buildings where some have already been sold to market-rate buyers. In that case, developers would also cut the price of the apartments. Another program would set aside $5 million for $40,000 grants to 125 homebuyers. For example, a single person or couple making $92,160 or less would qualify to buy a $380,000 apartment, using a $40,000 grant that the state provides the developer. A family of three or more making $107,520 would qualify to buy a $411,000 apartment. With these types of programs, the state typically requires buyers to hold on to the units for 10 years.
Sound good? Well, one Fort Greene developer is reportedly in serious talks to work out an arrangement. What a brave little guinea pig!
· City Seeks to Turn Stalled Projects Into Moderate-Income Housing [NYT]