New York City’s affordable housing crisis is the most challenging problem facing the Big Apple in decades, and the numbers tell the story.

Leila Bezorg, New York City’s executive director for housing, cited the 1.4% vacancy rate, 120,000 people sleeping in shelters the prior night, and more than 50,773 homeless children last year as proof that New York City is experiencing an unprecedented housing crisis.

“Unrelated to the federal government, the crisis has only gotten more serious,” she said at a March housing conference. “We have started to move away from either/or. We have a supply and demand problem.”

The shortage is most acute at the low end. More than half of the population is rent-burdened, and the median household income is about half what would be needed to afford the median rent.

According to the 2023 Census figures, the most recent available, the median household income in New York City is $79,713 a year. According to the traditional formula (income equivalent to at least 40 times rent, or rent set at no more than 30 percent of income), such a household could afford a monthly rent of $1,993.

In 2023, the median asking rent for available apartments for all of NYC was $3,500 a month, according to a 2024 report from City Comptroller Brad Lander. A household would need to make $140,000 a year to afford it. 

Still, many New York City households, including seniors, earn far less than the median. A significant number make less than $24,000 a year.

Some advocates say building more units and deregulation will lead to lower housing costs, but this hasn’t panned out so far. If it did, rents would have to fall to levels last seen some 20 years ago — presumably a financial catastrophe for developers.

To create enough genuinely affordable housing — affordable to households making anywhere from zero to 60% of the Area Median Income, a range under market rate — subsidies are needed. 

The good news is that New York City already creates fully subsidized and below-market-rate units for seniors, the formerly homeless, and working families every year. But the numbers are small, perhaps less than a few thousand units each year.

According to analysts, those working in affordable housing, and politicians, here’s how New York City can create enough truly affordable housing to meet its needs.

Focus on the biggest need

Beyond tax breaks and low-interest loans, full funding for construction and conversion is needed to produce the amount needed of genuinely affordable housing. Estimates from mayoral candidates of how many units are required and could be produced over a 10-year period range from 200,000 to 1 million.

The latter figure is about how many rent-regulated units have been lost over decades, primarily to vacancy decontrol and co-op conversions.

“They need more funding, they need to prioritize those kinds of projects when they have public land they’re going to develop on. That’s it,” said Samuel Stein, housing policy analyst at the Community Service Society. “Any housing can be deeply affordable as long as it’s subsidized to cover that cost.”

Find new sources of revenue

To boost its creation of below-market housing, New York will need more money. 

“There is a tremendous housing need, particularly for affordable housing,” said architect Mark Ginsberg at the Historic Districts Council’s annual conference in March. “There are lots of projects out there that are not moving ahead as quickly as we would like because the city doesn’t have enough money.”

Profit from an enterprise, such as a public bank, is one way to raise funds without increasing taxes. In France, state-owned bank profits are used to develop affordable housing and fund public art.

In New York City, the Public Bank NYC Coalition is working to set up a municipal bank to fund low-income housing, development in the public interest, and other public goods. Bills have been introduced in the New York State Assembly and Senate, including Senate Bill S1754, that would authorize municipalities to run public banks.

According to economist Lynn Ellsworth, founder of HumanScale New York, the city should create a dedicated affordable housing fund. Mayoral candidate and former Manhattan Borough President and NYC Comptroller Scott Stringer proposes establishing a $500 million revolving loan fund for nonprofits and community organizations to create housing. Mayoral candidate and State Senator Zellnor Myrie wants to redirect funding from city shelter construction to creating 50,000 affordable permanent homes.

A variety of ideas for new taxes to support low-income housing have been floated over the years, including a pied-à-terre tax, mansion tax, half-cent city sales tax, and, most recently, bringing back the stock transfer tax.

“We already have a large commitment to affordable housing, but it’s going to have to be bigger if we’re going to hit those numbers,” said Stein.

Offer tax breaks to preserve affordable units

Owners of multi-family housing say steep property taxes threaten to put them out of business, while the state gives tax breaks to new market-rate construction. Offering tax breaks to landlords whose rent-stabilized buildings are in good repair can help preserve much-needed affordable housing.

Take over and convert distressed buildings to affordable housing

Instead of letting buildings deteriorate while owners ignore fines, the city could take over apartment buildings from slumlords and landmarked buildings in severe disrepair as well as buildings headed to tax lien transfers.

Instead of handing over the latter to private, for-profit developers, the city or nonprofits would help convert all three types of properties to permanently affordable rentals with tenant associations or owned low-equity co-ops. (As the city used to do in the 1970s and 1980s.)

Stringer, Ellsworth, and mayoral candidate and former City Council member and current Comptroller Brad Lander advocate variations of this approach, including Ellsworth’s suggestion that the city build up a public land bank of such properties. 

Buildings whose conditions are so dire that court-ordered administrators are running them number an estimated 10,000, with some 100,000 units, according to a 2022 report from the Community Service Society. Just converting those alone to permanently affordable HDFC co-ops would add a significant amount of low-income housing to the city.

Rehabilitate existing houses and convert religious, office, and industrial buildings into housing for families, seniors, and the disabled

Eligible projects can tap into grants from the Preservation League of New York, federal and state tax credits, and the state’s NYSERDA sustainability program.

For example, the Federation for Westside Senior and Supportive Housing is adapting 1920s dormitory-style housing at the landmarked Three Arts Club at 340 West 85th St. on the Upper West Side for low-income seniors.

Give tenants the first option to buy

Bills at the city and state levels would give nonprofits and community land trusts the first rights to develop public land offered by the city, as well as tenants the first rights to buy their building when it comes up for sale, said Stein. These are the groups — not for-profit companies — that are creating the deeply affordable housing, he added.

The Tenant Opportunity to Purchase Act, or Senate Bill S221A, for example, gives tenants the right of first refusal and also the resources to convert their rental building into a limited equity co-op.

Create a new social housing development authority

A state-level social housing development authority could develop permanently affordable housing (both new and converted), not unlike how the Mitchell Lama program was created decades ago. This can help lower housing costs by removing developer profit from projects.

“We need a social housing authority,” said Manhattan State Sen. Cordell Cleare at the Historic Districts Council conference. “Don’t be afraid of the name ‘social,’ it’s OK. We need somebody whose job it is to develop affordable housing instead of running from developer to developer and none of it works. We need it to develop affordable housing for our low-income families and our seniors who need it.”

Restore the city’s crumbling public housing

Lander, Stringer, and Myrie are among the mayoral candidates calling for tenant oversight and $40 billion in funding to repair and update NYCHA housing.

Create appropriate housing for the mentally ill

Lander proposes creating SROs with wraparound services in existing buildings for 2,000 New Yorkers with severe mental illness.

Prioritize low-rise buildings over skyscrapers

The city should focus on six- to eight-story buildings rather than taller ones because they are the most cost-effective to build, Ellsworth told Brownstoner. They also help protect the livability of our city, she added.

Use modular housing technology

Stringer suggests using modular construction to speed delivery and lower costs of affordable housing. The basic techniques, which work only for low- and mid-rise buildings, have been widely used for decades.