You honestly said, with a straight face, that your 3K Manhattan is apartment is inhabited by the poor? Give me a break.

Uh, no. (Reading comprehension skills are the coolest!)

I said that my $3,000 Manhattan apartment is not inhabited by the rich. We certainly are not “poor,” but we also aren’t the target class of rich and/or wealthy people who these taxes are trying to target.

There’s a lot of space between “poor” and “rich.” And just because I said I’m not rich doesn’t mean that I claimed to be poor. Seriously, reading helps.

And why does NYC need more tax money? They already have a city income tax from Hades designed to tax the (working) rich.

At least if you taxed the apartments, you’d get all the people who live on capital gains. No, wait, they own their apartments.

I guess you’d just be taxing poor people with roommates (gasp!) who pay 3K. Need to think of other ways to soak the rich…. Property taxes!

Again, though, the main problem is not the people renting the apartments — because everyone needs somewhere to live — but the unscrupulous landlords who game the system, a housing court that doesn’t punish violation, and a pro-landlord rent control board. But those forces aren’t as visible as the “upscale NYU students” (and the school’s not *that* big) moving in next door.

Zuzu,

Neither my classmates, their families, or I are blind to the realities that the larger factors are the unscrupulous landlords, an indifferent housing court, and the rent control board as some of them have dealt with all of them firsthand. Unfortunately, the way it seems to work, the party with the most money/connections ends up winning…regardless of the merits of one’s case or the written laws.

In short, the view they and I hold is that while those “upscale NYU students” do not bear total responsibility, they are not seen by them as completely innocent either.* Their ability and willingness to pay higher rents was one important factor in those more invisible forces to do the work of shafting my classmates and their families.

When my friend was doing his research on the Boston housing crisis, he found the same dynamic writ large in many formerly undesirable neighborhoods such as Roxbury and Mission Hill…neighborhoods close to large universities and colleges. He mentioned that before the mid-late 1990′s, very few students wanted to rent in those areas due to the perceived dangers arising from the high crime rates and poor conditions of those areas due to municipal neglect. In fact, he and several longtime residents mentioned that the housing market back then was so bad that some unscrupulous landlords were setting their apartment buildings on fire to fraudulently collect insurance money. Since the late 1990′s onwards, however, the expansion of the area colleges to create additional dorm space combined with the influx of out-of-state and international students means that the rents in those areas have skyrocketed to the point that many low-income families were effectively forced out of their neighborhoods. I was floored when I found many undergrads renting studios and 1 bedrooms for over $1200-$2000/month and two bedroom apartments for nearly $3000/month in the very same areas they would not have been caught dead in just 7-10 years before. Despite promises by the colleges to set aside certain portions of the dormspace for low-income housing, most of the residents realized that was little more than crumbs meant to pacify their vociferous protests against the college’s expansion into their neighborhoods.

* I do not exclude myself from this analysis when I was living in my first neighborhood in the Boston area. I knew my presence as a young professional was driving an already crazy rental market even more high. Regardless of how much I tried to mitigate that by helping them in any way I could, I was part of the very gentrification that was pricing them out of their own neighborhood. To believe otherwise is to be in denial of my part of this phenomenon.

From what I’ve heard from classmates in high school and before, rent control/stabilized apartments are being reduced and despite the laws preventing this fact, many of them and their families were forced out of their rent controlled/stabilized apartments due to a combination of the landlords finding various sneaky loopholes and/or means to force rent control/stabilized tenants out.

Welcome to “luxury decontrol,” which takes apartments whose rent hits $2000/month and takes them out of the rent control/stabilization system. New buildings also aren’t subject to the laws, so they rent for market rates.

Again, though, the main problem is not the people renting the apartments — because everyone needs somewhere to live — but the unscrupulous landlords who game the system, a housing court that doesn’t punish violation, and a pro-landlord rent control board. But those forces aren’t as visible as the “upscale NYU students” (and the school’s not *that* big) moving in next door.

And people who own — and at least where I live, in Kensington, there are a lot of property owners — may get socked somewhat by higher property taxes as values rise (though tax bills are really low in the city due to the high commercial tax base), but if they want to take advantage of the higher prices, they can always cash out. Someone who paid less than $100K for a house decades ago may find that selling for over a million is worth it.

Well howdy, neighbor! (For the moment.)

I’ve lived in Kensington for about three years, and wow, the place has changed fast.

I see a lot more young, “hipster” kids getting off the train at my stop, when it used to be pretty much just my roommates and I.

Now the place is teeming with folks just out of college, and now there’s a neighborhood blog…it’s pretty wild.

My employment situation is pretty bizarre, so I can’t afford to move any time soon. I’ve already come to terms with the fact it’s unlikely I’ll live in Manhattan again in my lifetime.

Housing is fucked.

I am of the opinion that knowledge and learning are inherently worthy, admirable pursuits. I see no reason to accord the amassment of huge clumps of money the same respect.

I’m also not sure how much gentrification really affects existing renters, though, in a city that has rent stabilization and rent control laws. Sure, if people are getting kicked out of their buildings illegally, then there’s a problem, but it’s due to the landlords violating the leases or stupid occupancy rules, not the kine of people coming in.

From what I’ve heard from classmates in high school and before, rent control/stabilized apartments are being reduced and despite the laws preventing this fact, many of them and their families were forced out of their rent controlled/stabilized apartments due to a combination of the landlords finding various sneaky loopholes and/or means to force rent control/stabilized tenants out.

From what they’ve told me and what I’ve seen when I helped some of them move out after the courts found in favor of the landlords, the housing courts have shown lackluster interest in enforcing those regulations.

Many of those same apartments are now being rented by more upscale college undergrads attending NYU.

Why not go straight to the source and tax income? Seems like a better way to weed out the rich people than trying to figure out what they and they alone buy.

Earned income isn’t the true marker of wealth; interest income, and income from capital gains, is. I remember seeing some tax forms from George Bush, and his entire income derived from the interest from Treasury bonds. Or bills. I forget.

Anyway, what distinguishes rich people from wealthy people is that wealthy people have one very simple rule: Don’t fuck with the principal. Rich people may have a lot of money, and a lot of stuff, but it’s the kind of money that can go away, as Chris Rock observed, in one year with a drug habit. Wealthy people have investments and assets that are beyond the reach of the beneficiaries; that’s why they set up trust funds.

The tax code favors interest income, and capital gains, over earned income. Which is one reason that CEOs have so much of their compensation in stock options. There’s a lot you can do to offset those gains, but not so much with the earned income.

Wealthy people protect their wealth from generation to generation, which used to be easier than it is today. Take any random Jane Austen novel: the heroine was usually in a predicament due to the fact that her family was composed of all girls; there used to be a thing called a fee tail that passed property — all of it — usually to the oldest male heir. This is why the Bennet sisters would lose Longbourn (and all but a small income) to William Collins or why the Dashwood sisters were turned out of Norland when their father died and their half-brother John became the heir.

It was designed to keep estates together, though of course lines (male lines, at least) could fail, or someone could fuck with the principal. The fee tail is actually responsible for one set of my great-grandparents coming to the US, since my great-grandfather was the second son of a landed family in Ireland and got bupkis. So they started from scratch over here, where the idea really never took hold. And the fee tail was eventually abolished.

The estate tax, at least before anyone started throwing up family-farmer and small-business-owner strawmen, was designed to be sort of the anti-fee-tail and keep dynasties from forming through inherited wealthy. Mind, the wealthy can pay for good lawyers and estate planners, so a lot of stuff gets around that.

One reason that there are single people (and seriously, folks, do we have to demonize single people? Families aren’t the only households that count), and by single people this discussion pretty clearly means “single, educated, probably with some disposable income,” moving into certain neighborhoods is that they’re priced out of other neighborhoods. The luxury condos are bought by people who are mortgaged up to their eyeballs, and because they can still get mortgaged up to their eyeballs, the prices continue to rise. Everywhere else in the country, prices are falling because the mortgaged-up-to-their-eyeballs people just can’t pay anymore. That hasn’t happened so much here.

But neighborhoods do change over time. Flatbush, for example, was once a Jewish neighborhood, and now is largely Jamaican. I’ve watched my own neighborhood become much less diverse and much more young-white-couple-affluent over the past 6.5 years. I knew someone whose grandmother was upset that she was moving to the Lower East Side because the family had fought so hard to get out of there years before.

I’m also not sure how much gentrification really affects existing renters, though, in a city that has rent stabilization and rent control laws. Sure, if people are getting kicked out of their buildings illegally, then there’s a problem, but it’s due to the landlords violating the leases or stupid occupancy rules, not the kine of people coming in. It seems like it’s more a problem for young people who can’t move out of their parents’ places if they want to live in the same neighborhood because while their parents have a rent-controlled place, they will have to get market rates. But that’s a common problem everywhere.

And people who own — and at least where I live, in Kensington, there are a lot of property owners — may get socked somewhat by higher property taxes as values rise (though tax bills are really low in the city due to the high commercial tax base), but if they want to take advantage of the higher prices, they can always cash out. Someone who paid less than $100K for a house decades ago may find that selling for over a million is worth it.

I’m curious (honestly curious!) what effect there is on rental prices when there’s an increase in the supply of housing, even if the increase is all condos. I really have no idea, but it’s not inconceivable that the effect could be good.

I’m curious myself, too, what the general effect tends to be. Over here, again referring to Williamsburg and Northern Brooklyn, there are plenty of condo buildings going up (which frankly are not getting filled), but the rent prices keep on going up due to the changes in population demographics.