How Failed Housing Policy Reshaped Brooklyn’s Communities
By: Arvind Sindhwani
Tags: Housing, New York City Real Estate, Affordable Housing, City Planning

As the city government’s approach to affordable housing has changed in recent decades, Housing New York serves as a prime example of the limitations of the modern system. New affordable housing units are integrated into market-rate construction, with different set-aside requirements based on income distribution. Thus, affordable housing mechanisms are tied solely to new development, often built in rapidly gentrifying neighborhoods where it is cheap enough to finance the affordable housing set-aside and where a high enough demand exists for new units. The recently announced housing plan does little to address the core issues of the city’s housing crisis, but rather enables ongoing real estate trends that have been detrimental to Black and Latinx communities. What results from this phenomenon is the hyper-concentration of new housing in select parts of the city, failing to be spatially equitable as other parts of the city see little to no construction.

Of the five boroughs, more projects related to Housing New York have been built in The Bronx and Brooklyn than the rest of the city combined. Upon further analysis, the funneling of new construction into specific districts within the respective boroughs is even more severe. Expanding this analysis past spatiality, specifically to race and demographics, is an essential addition. It can already be concluded that any geographical concentration of new affordable housing is unhealthy — both for the location of affordable housing, and the developmental pressures that comes with it. With the exception of Brooklyn Community Districts 1 and 2 (Williamsburg/Greenpoint and Downtown Brooklyn), which include a significant portion of Housing New York’s supply of new construction from new luxury high-rise development, predominantly Black and Latinx areas are disproportionately targeted as areas for new development. The racial and spatial disparities analyzed in the above graphs can be attributed to relatively cheap land costs, low rates of homeownership, and less organized community opposition. Predominantly white districts of the city, such as Community District 6 (Park Slope/Carroll Gardens), have advantages including higher-than-average homeownership rates and protectionist zoning, making it financially undesirable for developers. With the city locked into a public-private partnership, real estate markets thus dictate the spatial outcomes of our present and future housing opportunities.

Financing and Zoning

Similar trends of development are mimicked when mapping the number of residential units financed through the usage of the 421a Tax Abatement, which provides tax breaks for developers if they build a required amount of affordable housing. As mentioned in the previous section, driving developers to build only where it is profitable has led to substantial disparities in where new housing is being built. Populous neighborhoods such as Borough Park, Kensington, and Canarsie have experienced relatively insignificant levels of multifamily financing, while Crown Heights, Bedford-Stuyvesant, and Bushwick have seen explosions of new development. In combination with easy access to Manhattan, relatively cheaper rents, and cultural demand, the desire to live in these select neighborhoods is reflected in drastic increases in construction and financing for multifamily buildings.

Source: 2019 Census Data, Department of City Planning — Zoning Districts

Furthering this analysis, it is important to pose the question as to why these distinct communities in Brooklyn are seeing unprecedented levels of real estate development. Leaving market forces aside, underlying zoning laws can better explain the resultant racial disparities that arise from market-reliant housing policy. In contextually zoned areas, often correlated with high rates of white households, low-rise aesthetics and lower levels of density are protected. Reducing the capacity for development in white enclaves of the city yields higher property values due to rarer, older, and more desirable housing. In turn, communities lacking protectionist zoning policies see much greater communal changes than those that do. Unfortunately, city government and planning-related agencies are complicit in the discriminatory outcomes that originate from its reliance on the private market and appeasement to white homeowners. In Williamsburg/Greenpoint, ample protectionist zoning and a relatively high rate of Housing New York Development are able to co-exist. Major transit thoroughfares and waterfront corridors have been upzoned to properly incorporate new affordable housing options and density; all the while homeowners and renters in contextually zoned segments of the neighborhood can reap financial benefits that are tangential to new development. In Bushwick, where contextual zoning is almost non-existent and new housing construction is rampant, the detrimental effects of disproportionate protectionist/pro-development policy are visually stark and will be further discussed below.

Neighborhood Effects

While this report utilizes Mayor De Blasio’s Housing New York as an example of misguided housing policy, it is by no means the sole contributor to the following trends. Instead, it is representative of flawed market-reliant policy that has unfairly created developmental pressures in working-class neighborhoods of the city while simultaneously supporting protectionist zoning and homeownership opportunities in white, high-income neighborhoods. Incentivizing the new development of housing without equalized protectionist zoning or renter protections in at-risk neighborhoods has only exacerbated a chronic issue the city has faced for decades. In the case where protectionist zoning ceases to exist in all enclaves of the city, communities of color will still bear the majority of development pressure, but much less so than today. Insurmountable community opposition and high land costs have expelled development in predominantly white neighborhoods with strong homeownership, encouraging developers to build where it is cheaper. That being said, differences in rent stabilized units over time proves to be an important indicator for neighborhood changes and can reflect how real estate pressure may impact a given area.

In terms of borough-wide trends, two thirds of Brooklyn’s communities lost a marginal or significant amount of rent stabilized units, and a third gained in rent stabilized units or stayed the same. The two districts that made the most use out of 421a financing, districts 1 and 2, saw noteworthy increases of 26% and 65% of rent stabilized units, respectively. In comparison, Community District 4 (Bushwick), lost 14% of its rent stabilized stock across the neighborhood, and only saw gains in a handful of new buildings that are centered around luxury development hotspots. Without supply-side financial incentives to rehabilitate, develop, and construct new affordable housing in less-desirable portions of a given neighborhood, new development will fail to reach much needed areas.

Source: Pratt Center Neighborhood Data Portal

The spatial unevenness that arises from said phenomenon has detrimental effects on the community as a whole — market pressures will continue to raise the area’s cost of living without providing new employment opportunities and accessible amenities. Speculatory practices have favored prospects of more profitable developments or market-rate rents, upending the livelihood of long-time tenants. With such an intense decrease in the rent stabilized housing stock and lack of strong contextual zoning laws, many minority communities are facing or will inevitably face the same fate as Bushwick. The outcome of exploitative policies is saddening — upzonings, promising to create new affordable housing, can often lead to an insurmountable loss of rent stabilized apartments, which is undoubtedly New York’s most affordable housing. As a lifeline for those that could not otherwise afford to live in modern-day New York, losing rent stabilized apartments only further damages a community that lacks protectionist zoning or robust renter protections.

Black and Latinx individuals, the demographic groups most at-risk of displacement, experienced alarming changes in three key neighborhoods: Bedford-Stuyvesant, Crown Heights, and Bushwick. In Crown Heights and Bedford-Stuyvesant in 2018, the quantity of Black residents decreased by 15% and 18%, respectively, since 2009. In Bushwick, Latinx residents decreased by approximately 19%. In comparison, white households in these three neighborhoods have increased by an average of 126% within the same time span. This is not to say that young, white renters should not live in these respective neighborhoods — upzoning around transit corridors and building in abandoned lots alongside renter protections should encourage a denser, more diverse community without causing ruptures in the pre-existing fabric. Black households saw strong increases in neighborhoods further south and east, indicating a potential relocation in light of rising rents and costs of living in neighborhoods closer to Manhattan and other major job centers. The displacement and replacement of Black and Latinx households is nothing short of modern-day segregation, giving those with higher racial and wealth statuses priority in the housing market.

Conclusion

As the city rounds the corner of Housing New York’s construction and preservation goals, it is essential to reflect on its effects through its association with the real estate market. Through the hyper-concentration of affordable housing in select segments of the city, the implications of public-private development of affordable housing has gone unnoticed. With less diversity in the city’s overall spatial allocation of housing, certain neighborhoods that may require additional real estate investment will continue to go underfunded while only a select few have been radically changed to incorporate the city’s growing need for new housing. Statistically, the communities in Brooklyn that have borne the weight are traditionally Black and Latinx, which are, on average, the most affected by evictions and rent burdens. The real estate market is not the only figure to hold accountable for this resultant outcome. As a consequence of the city government’s complicit actions in nurturing this public-private partnership without taking essential precautions, we are left with a city that is more spatially unequal and segregated.