While New York City’s apartment vacancy rate is still below 2%, according to an April report from brokerage Corcoran, and the metropolis remains a notoriously expensive place to build, there has been quite a bit of progress lately in increasing the housing supply, Commercial Observer reported. That’s largely thanks to city and state efforts, including residential-friendly rezonings and tax incentives such as the 2-year-old 467-m tax break for conversions to residential. There were 38,682 housing units completed within new buildings in New York City in 2025, according to the Department of City Planning, a year-over-year rise from the 33,859 units completed in 2024. This represented the most units completed in a single year since 1965 — yes, since 1965 — and the second consecutive year that over 30,000 units were completed. A CoStar report from May showed that New York City led the nation in terms of multifamily construction, with 43,000 units under construction in the first quarter of 2026. This came at the same time construction starts were down nationally to their lowest quarterly level since 2011. Some of the neighborhood-specific rezonings were in Gowanus, Brooklyn; Jamaica, Queens; Long Island City, Queens; and Prospect Heights, Brooklyn. The rezonings are expected to clear a path for around 50,000 new units in the coming years, with about 10,000 already being delivered in Gowanus alone. Still, to defeat the city’s housing shortage, there needs to be 50,000 to 60,000 units produced per year, otherwise there will be a continued shortage of about half a million units by 2034, according to Shimon Shkury, founder and president of Ariel Property Advisors. Many in the commercial real estate industry consider the sunsetting beginning in 2022 of the 421-a multifamily development incentive, which rewarded the inclusion of affordable housing in a project with significant tax abatements, as a setback for fresh construction. Its replacement, 485-x, has led to a wave of smaller projects due to construction wage requirements that state lawmakers baked into the incentive. Replacing 485-x would spur even more construction over the long term, these critics say. |
No comments:
Post a Comment