East New York Real Estate Prices Tripled Overnight
(Sustainable Communities: East New York)
The neighborhood that's supposed to be the model for new affordable housing developments is rapidly becoming unaffordable.
East New York is the first of 15 sites to be developed under
Mayor de Blasio's $41 billion housing plan that promises to build or maintain 200,000 units of cheap housing, but
according to the Wall Street Journal, land prices there have almost tripled, from $32/square foot to $93.
Apartments in East New York now sell for $155/square foot, up from $143 last year.
In the first half of 2013, there were $2.7 million in real estate transactions conducted in the neighborhood. In the first sixth months of 2014, that number rose to $42 million.
In 2010, a housing complex with 43 affordable units received 15,000 applications.
How is the
city's strategy of coaxing private developers to build affordable units supposed to work if getting a return on their investment is made exponentially more difficult?
If
affordable rents in a neighborhood where the area median income hovers around $32,000/year (the city's median is $52,000) range from $375 to $625/month, but 80% of the development's housing will be built for those paying considerably more than $630, who is actually benefiting from this "affordable" housing?
In July, the executive director for the Department of City Planning, Purnima Kapur,
told us that the city had commissioned a study to examine "what it is that market can support in terms of how much affordability we can ask from a private developer."
Now they might need a new study.