You knew that tax bill hurt. The Furman Center at NYU just released an analysis showing that property taxes on apartment buildings are five times the taxes on similar 1-3 family homes in the City, and New York ranks second in the nation for effective tax rates on apartments after the thriving city of Detroit.
That’s hampering residential construction, but not stopping it thanks to tax incentive programs. The Building Congress reported this week that residential construction rose 26 percent last year, although it is still less than half the 2007 level. Unfortunately, they also predicted that the government spending that has been sustaining the construction industry would decline 40% by 2013 from last year’s total.
The first clues to next year’s stabilized rent increases came out this week when the Rent Guidelines Board proposed a range of increases for one year renewals of 1.75 – 4 percent and 3.50 – 6.75 percent for two year renewals. They will hold hearings on June 13th and 18th, and vote on final numbers June 21st.
Mayor Bloomberg’s initial budget proposal for fiscal 2013 would reduce the head count at the Department of Buildings by just 5 people and the personnel at HPD by about 40 people. DOB’s budget would be essentially flat, but HPD is facing the loss of more than $200 million in federal revenue, apparently mostly from tenant assistance programs.
ABO’s BuildingsNY show was a great success this week. Be sure to save April 24th and 25th 2013 for next year’s show.
Please join us also at our next ABO/NRC luncheon, May 22nd. Invitations and details will be out soon.