A new report released by the city’s Rent Guidelines Board (RGB) is throwing into question whether it will approve a rent freeze on rent-stabilized apartments this year.
After two consecutive rent freezes in 2015, and 2016, the RGB allowed for rent increases of up to 2 percent last year. Rent-stabilized tenants want to ensure that the same doesn’t happen this year, and members of the Rent Justice Coalition and local elected officials have been rallying in front of the RGB’s offices during their scheduled hearings to demand a rent freeze.
This new report, titled 2018 Price Index of Operating Costs (PIOC) is the annual report that the RGB puts out that examines the changes in costs of goods and services that usually go toward the maintenance of rent-stabilized buildings.
This PIOC is comprised of seven different cost components: taxes, labor costs, fuel, utilities, maintenance, administrative costs and insurance costs. The PIOC for rent-stabilized apartments increased 4.5 percent this year; that’s down from the rate of increase last year which was 6.2 percent.
Among the seven different PIOC components, fuel increased the most, by 16.4 percent. That’s less than last year’s increase of 24.6 percent but still significantly higher than 2015 and 2016 when there was a decrease of 21 percent and 41.2 percent respectively.
Taking all those factors into account, it seems unlikely that the RGB will approve a rent freeze this year.
Just a month prior to the release of the 2018 PIOC report, the RGB released the 2018 Income and Expense Study. In these studies, the RGB looks at Real Property Income and Expense (RPIE) statements from rent stabilized buildings that have been collected by the city’s Department of Finance. This allows the board to suss out the overall economic condition of the city’s rent-stabilized housing stock.
The study showed that 2015-2016 was the 12th consecutive year that landlords saw an increase in net operating income. This year’s figure stands at 4.4 percent, which is less than the 10.8 percent increase between 2014-2015.
Rent-stabilized tenants however point to this study as another reason that the Board should freeze rents this year.
“Landlords are making plenty of profits while families barely make it from paycheck to paycheck,” said Nova Lucero, an organizer with the Metropolitan Council on Housing, in a statement. “It would be unconscionable to raise rents on rent-stabilized tenants. The Rent Guidelines Board must freeze rents so that regular New Yorkers have a fighting chance to stay in their homes.”
The Board will make its final vote at the end of June this year.