New York State recently passed new legislation that extends downstate rent regulations to the rest of the state. This law will (among other things) allow any community in New York State with a tight rental market to establish rent stability measures that limit the ability of many landlords to raise rents beyond a certain level each year.
The concern behind this law is rooted in a sense that rising rent prices are displacing long-time residents in communities throughout the state. In Rochester, affordable housing activists are increasingly concerned about gentrification in the Beechwood and PLEX neighborhoods, although other areas in the City are also apparently feeling some pressure.
I’ve heard it stated a number of times that unlike New York City, San Francisco, and a number of other communities, Rochester does not have a rent crisis, we have a poverty crisis. And there’s certainly some truth to this.
Low income households in Rochester are highly likely to be rent burdened, whereas middle class families are largely able to find affordable housing. The chart below (all of the data below comes from the American Community Survey) compares Rochester’s rent burden (defined as paying more than 30% of one’s income on rent) to New York City. The rent burdened population in Rochester is largely concentrated among low-income families, while high rents in NYC result in significant percentages of middle class households paying more than 30% of their income on rent.
That said, Rochester is clearly experiencing rising rents. The chart below shows the median contract rent in Rochester from 2005 through 2017.
The median rent in Rochester rose by 34% over this period. This represents a modest, but still cumulatively substantial 3% increase per year. And given that 47% of renters in Rochester live in poverty, even modest rent increases have the potential to displace longtime renters.
The two charts below compare rents from 2008-2012 to 2013-17 (the last two distinct 5 year data collection periods for the American Community Survey). There’s a pretty clear shift from rents in the $500 range to $700. There’s also a small but noteworthy increase in rents above $2,000 per month.
Interestingly, the number of rental households in Rochester continues to grow, while the population and housing stock remains level. This may be part of a long-term trend toward smaller household sizes.
While debates over new multi-family apartments consume a great deal of local discussion, new construction only represents a tiny fraction of overall rental housing in the City. Less than 4% of all occupied rental housing in Rochester today was built during this century. Over half of all rental housing in Rochester was built before 1950, and almost two-thirds of renter households live in structures with less than 5 units.
A difficult challenge to manage is the need for housing to remain affordable for low-income renters against the reality that landlords need to generate a certain amount of revenue to maintain an aging housing stock throughout the City. While some share of landlords undoubtedly extract profits on increasingly decaying properties from vulnerable tenants, I imagine that many others want to maintain and improve their properties over time. But if they cannot raise enough revenue through existing rent prices, I imagine they either choose to neglect necessary repairs or end up raising rents.
For example, $400 for an apartment each month is quite affordable for many low-income renters, but does that cost provide enough funds for landlords to fix a roof, replace kitchen appliances, and otherwise ensure a property is in good shape? I have to imagine that extremely low rents, absent some other form of subsidy, eventually leads to disinvestment and decay.
At a more fundamental level, our efforts to assure housing quality and affordability stem from a desire to mitigate the effects of staggering levels of poverty and income inequality. We need better federal, state, and local policies that raise the incomes of poor residents in Rochester and throughout the country. Short of that, we need to find more ways (beyond our somewhat limited Housing Choice Vouchers) to subsidize low-income renters to ensure they can affordably find safe and stable housing.
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