In sum, these factors have led to the highest level of profitability in apartment buildings since 1989. While predictions are always dangerous, the near term future appears quite positive for owners of rent stabilized housing. With further reductions in vacancy and collection losses and the higher increases recently passed by the Rent Guidelines Board, it is likely that profitability will improve further in the near term. On the tenant side of the equation the picture is somewhat murkier. Inflation-adjusted wages seem to be steady or increasing.
Employment is up substantially from a year ago and job gains appear to be accelerating.
Without data from the 1996 New York City Housing and Vacancy Survey we cannot say for certain whether housing is more or less affordable than two years ago. However, an educated guess is that tenants as a whole are no worse off and may be slightly better off. Although costs have crept up slightly since 1994, inflation continues to be quite moderate. The subsidence of inflation in the early 1990's was due in large part to a sharp drop in the rate of increase in real estate taxes. Rising property values and stable or increased tax rates boosted landlords' tax bills throughout the late 1980's and early 1990's, but the severe recession eventually dampened increases in property tax assessments.