Diversify NYC’s Housing Stock
By Yvette Chen, Program Manager, Center for NYC Neighborhoods
The Problem: Black Homeowners Are Leaving NYC
As costs of living, and owning a home, continue to rise, Black homeowners are struggling to stay in New York City. We see it over and over again in news coverage, and from Black homeowners who reach out to the Center for NYC Neighborhoods looking for guidance as they fight to keep their homes.
We see evidence of this frequently, in the stories of homeowners who call our Homeowner Hub. There is a homeowner from the Bronx, who lost her income and fell behind on her mortgage payments struggling to keep her home. Another homeowner in Queens wants to pass her home on to her loved ones in the future but doesn’t know how to do so. Then there’s a homeowner in Kings County, whose loss of income caused her to fall behind on her water bills and the home repairs she needs. The specific issues vary, but the underlying challenge is the same — New York City homeowners are struggling, and we need solutions.
Solution: Alternative Housing Models
Many existing approaches to the housing crisis do not address the growing trends in the decline of homeownership and the loss of permanent affordable housing in communities of color. One solution: alternative housing models that specifically aim to combat racial disparities in affordable homeownership, including community-controlled purchase policies, community land trusts (CLTs), and limited equity co-ops. These approaches preserve existing housing, create permanent affordability, and remove housing from the speculative market. These shared equity housing models also foster community, long-term affordability, and the opportunity to build generational wealth for communities that have been shut out for too long.
Solution: Community-Controlled Purchase Policies
Tenant and community opportunity to purchase policies are an emerging anti-displacement strategy that lock in affordability and offer an entry into homeownership opportunities to current residents. TOPA, or the Tenant Opportunity to Purchase Act, gives tenants in most residential buildings the first offer and first right of refusal if their landlord decides to sell the building. TOPA was first enacted in Washington, DC in 1980 and since 2002, has preserved over 3,500 homes in the city.
COPA, the Community Opportunity to Purchase Act, complements TOPA by requiring owners of buildings to notify qualified non-profit organizations before listing the property. These organizations have the right of first offer and refusal. TOPA and COPA are gaining traction in areas with highly speculative markets, such as New York City and the Bay Area, because they create a meaningful opportunity to slow down the speed of real estate transactions so that communities can consider their options, and counter neighborhood change and the high costs that can come with gentrification.
Solution: Community Land Trusts
Community Land Trusts (CLTs) are another important piece of the puzzle in buttressing affordability and removing land from the speculative market. In the CLT model, land is owned in common by a CLT, a nonprofit chartered to hold the land in perpetuity. The CLT model is also less risky than the traditional housing market; a study found that during the Great Recession, 82% of seriously delinquent homeowners were able to avoid foreclosure with assistance from the CLT. The CLT movement, which originated from the Black Civil Rights movement, is now one option that, together with the other alternative housing models listed here, can help make homeownership sustainable for Black families.
Solution: Limited Equity Co-ops
Co-ops are another example of a shared-equity model of homeownership. Co-op residents buy shares in a co-owned building, known as an “equity deposit.” These shares can be sold at either market rate or below market rate in limited-equity co-ops. Currently, co-ops comprise nearly 75% of Manhattan’s apartment stock.
What’s Next for NYC & Alternative Housing Models
NYC has a history of successful use of alternative models, and there’s a lot we can build on. Currently, there are 17 CLTs throughout New York City, including Interboro Community Land Trust, which is one of the Center’s most important partners. Interboro CLT is the only New York City based CLT to focus on permanently affordable homeownership, and their pipeline includes homeownership projects — limited-equity co-ops (LECs) and single-family homes — in Brooklyn, Queens, and The Bronx. Community land trusts like Interboro can benefit those who would otherwise not have the opportunity to become homeowners and help homes maintain their affordability in areas of the city that are rapidly gentrifying.
The Mitchell-Lama program, introduced in 1955, created affordable co-op housing for low- and middle-income households, While nearly 20,000 of the original co-ops have been converted to market rate since 1989, some examples, like Co-op City, still offer long-term affordability to residents.
In order to successfully and meaningfully address housing needs of NYC’s Black community , we need new funding and capacity building mechanisms to support bold structural change in the housing market. Pairing alternative housing models like the ones above with existing popular solutions, like inclusionary zoning, can help NYC produce solutions in homeownership. These alternative models — shared equity models of housing, paired with policies like TOPA/COPA — not only help create permanent affordable housing opportunities, but also further a collective vision that honors our city’s need for housing justice.
About the Center for NYC Neighborhoods: Established by public and private partners, the Center meets the diverse needs of homeowners throughout New York State by connecting households to free, high quality housing counseling and legal services. Today the Center is working to address historic racial injustices in homeownership, preparing communities to be climate resilient, and helping New Yorkers to recover from the pandemic.
