May 4, 1997 Rent Hikes Outpace Pay Raises - Study
By MICHAEL FINNEGAN Daily News Staff Writer
Rents have risen faster than paychecks over the last several years for most residents of the city's 1 million rent-stabilized apartments, according to a new study obtained by the Daily News.
Tenants also had to spend 2.5% more of their hard-earned dollars last year to cover the rent than they did in 1993, according to the city Rent Guidelines Board report set for release tomorrow.
The findings come six weeks before the threatened expiration of the state laws that limit rent hikes and evictions for tenants of rent-stabilized apartments.
The study, based on U.S. census data, found the median rent for a stabilized apartment jumped 14% from 1993 to 1996, rising from $525 to $600. Median household income for rent-stabilized tenants rose 7% from 1992 to 1995, growing from $20,150 to $21,600, the study found.
"Rents are up, incomes are down and people are hurting," said Michael McKee of the New York State Tenants & Neighbors Coalition. "The whole system is biased against tenants."
McKee argued that the conclusions underscore "why we have to keep these laws on the books."
Landlord lobbyist Joseph Strasburg questioned the accuracy of the figures, saying they do not reflect income from the city's "underground economy."
Strasburg, president of the Rent Stabilization Association, a group of 25,000 landlords, also said rents rose more sharply in Manhattan below 96th St. than in the rest of the city, skewing the citywide figures.
"It's a Manhattan phenomenon," he said.
The study also found:
Tenants in stabilized apartments spent 30.7% of their household income on rent last year, up from 28.2% in 1993.
The percentage of tenants spending 70% or more of their household income on rent jumped from 17% in 1993 to 23% last year.
The number of city tenant evictions rose from 21,937 in 1993 to 24,370 last year.
The report suggested some of the New Yorkers who spend the bulk of their income on rent might not be classified as poor. Some could be students partly supported by parents, families living off savings or households in which the main breadwinner is out of work, the report said.
The Rent Guidelines Board will use the study to help decide the rent hikes allowed during the fiscal year that starts Oct. 1.
The board also will consider separate findings that found landlord operating costs rose 2.4% last year. To keep landlord profits steady, rents would have to rise 1% to 3% for one-year lease renewals and 2% to 5% for two-year leases, the study found.
The board is scheduled to propose specific rent hikes Wednesday. A final vote is slated for June 23, after a series of public hearings.
But it's highly uncertain whether Gov. Pataki and state legislators will renew the state laws that authorize the board to cap rent hikes. State Senate Majority Leader Joseph Bruno (R-Rensselaer) has threatened to let the laws lapse June 15 unless lawmakers agree to phase them out within four years.
Original Story Date: 050497
Original Story Section: City Central