Dear Editor ,
This letter is a response to your comprehensive, powerful story about the escalating cost of living in an apartment that is making it economically possible for only the wealthy or low income (public housing) residents to live in Manhattan.
Another possible niche for affordable, owned housing could be built (or converted?) in New York was demonstrated around fifty years ago when the Mitchell Lama law was passed to support, (not finance) mortgage backed purchase of real estate and building with participation investment cash payment for shares by approved cooperators , bank mortgage backing, lower state RE taxes with rules, organization, maintenance run by the cooperator’s elected board of directors and approved by the state .
The idea was to keep the fleeing lower middle income class in NYC in the sixties, seventies and discourage their purchase of the then inexpensive homes on Long Island and New Jersey.
The only way this law was passed at that time in Albany by the hugely powerful real estate political influence was to deny the M/L cooperators the crucial home owner equity ownership that other private co-ops with a similar organization enjoyed.
Ironically, and revealingly, these co-ops eventually became really “low cost” living in New York with highly maintained,serviced, stable tenants, communities, for one reason. There was no landlord motivated by profit to constantly raise the rents whenever possible so today the public and private M/L co-ops cost dramatically lower than market rents with the best services, run and guaranteed by the owner co-operators.
If somehow the all-powerful real estate interests we see building everywhere in town going for astronomical rents or prices based upon making the most profit return can be by-passed , the state could encourage, as they do with other business development,the construction of tenant equity owned, mortgage backed owner run co-0ps solely for the benefit of the tenants with no runaway rents. The start up costs ,initially paid for participation shares and mortgage at low rates, would not be cheap but would be lower than buying into already established co-ops or condos.
However, this niche plan would put a people’s interest, quality ownership, cost, maintenance rent cap into this sector, insulated from the merciless real estate business.