NewsDoes Governor Hochul Have a Plan to Address New York’s Housing Shortage?

Does Governor Hochul Have a Plan to Address New York’s Housing Shortage?

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Kathy Hochul was recently elected to her first full term as Governor, but with narrower margins than anticipated. Her election was relatively close compared to recent statewide elections in New York, meaning she will need to appease residents across the state if she plans to run for reelection next term. One way she can deliver for her constituents is by addressing the state’s housing shortage.

New York, just like the nation as a whole, has a deep housing shortage that only worsens the current affordability crisis. New York also isn’t building enough housing to meet future demand. An analysis of New York City housing found that the city should be building about 62,000 housing units annually through 2030 but is currently only constructing 30,000 each year. The city needs to build twice as many housing units per month compared to the current construction rates. Statewide, New York is also lagging severely.

While campaigning for reelection, Hochul promised to construct between 500,000 and 1,000,000 new homes across the state. Many of these housing units will be affordable. In Hochul’s Financial Year 2023 State Budget, $25 billion will fund a comprehensive, five-year housing plan focusing on constructing or preserving 100,000 affordable homes across the state. 10,000 will include support services for vulnerable populations.

While Hochul provided funding for affordable housing production and preservation, she hasn’t yet outlined additional plans to incentivize and allow for further affordable and market-rate housing construction. The state needs a comprehensive housing plan, considering that New York City needs to double its current level of housing production to meet future demand. Now that she has won the latest election, there will be increasing pressure on Hochul to present more details on how she will achieve her housing construction goals.

CitySignal previously reported on Mayor Adams’ plan to address NYC’s housing shortage by transforming The Big Apple into a “City of Yes”. On a statewide level, the Adams administration wants the state government to pass a replacement for the expired 421-a program, which provided tax breaks to developers who included affordable housing in their development. They also want the state to replace the expired J-51 program, which allowed for an incentive to developers who rehabilitate old apartments that have gone unused for years.

Hochul previously proposed a replacement for the 421-a program in her budget proposal, but it didn’t garner enough support in the state legislature for it to pass. Right now, it’s unclear if Hochul’s administration has any alternative proposal to replace the 421-a or J-51 tax breaks.

Developers argue that high property taxes on rental properties and expensive construction costs make building housing, especially affordable housing, unaffordable without a tax break. Meanwhile, opponents see tax breaks for developers as unnecessary government giveaways to wealthy corporations.

The Adams administration also wants the state legislature to make it easier for homeowners to build additional housing on their properties, along with legalizing the thousands of currently illegal basement apartments in the city.

Hochul could also use her power to advocate for revised zoning and higher density in suburban communities and neighborhoods with proximity to mass transit. Many suburban communities have highly exclusionary zoning laws that make it illegal to build anything but single-family homes.

Ultimately, Governor Hochul will have her work cut out for her. She has to present her ideas to a state legislature that has previously opposed her plans from both the left and the right.

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