NY Reconciliation Letter 2022

July 13, 2022

The Honorable Charles Schumer
Senate Majority Leader
S-230, U.S. Capitol Building
United States Senate
Washington, DC 20510

Dear Majority Leader Schumer:

Our organizations, joined by several individual New Yorkers, write to you on behalf of the people and communities we serve across the great state of New York to urge you to continue championing the need for significant housing investments in the reconciliation package you are negotiating.   Investing in these priorities will allow families to realize both near and long term solutions to the housing-related challenges they are facing today.  Reports suggest the reconciliation package is being framed as a legislative effort to tackle inflation.  However, any effort to stabilize the inflation families are experiencing that does not address the nation’s skyrocketing housing costs will fall short of the legislation’s promise.  In fact, the Federal Reserve Bank of San Francisco predicted in February 2022 that rent inflation alone could add as much as 0.5% to the Personal Consumption Expenditures Price index for both 2022 and 2023.

New Yorkers across the state are facing skyrocketing housing prices on top of higher costs for everyday necessities that keep families going. The cost of buying a home in New York State has risen more than 35% in the last year. At the start of the pandemic, a family earning $100k could afford one out of every three homes on the market. Today, a family with the same income can only afford one out of every five homes listed for sale in New York.

That has put home ownership out of reach for many families, and it contributes to our stark racial homeownership gap. White families in New York are more than twice as likely to own their home than Black families.

At the same time, rents across the state have risen 18%, and more than half of all renters now spend more than 30% of their income on housing. The problem is even worse in New York City where rents have risen 33% and the average monthly rent in Manhattan has reached $4,000.

And we know we’re not alone.  In rural and urban communities alike, the average family is spending 33.8% of their monthly budget on housing costs.  In the 40 largest metropolitan areas, rents have risen by as much as 30%.  Nearly 38% of rural Americans are cost- burdened and 19% are severely cost burdened, often living in communities that are more likely to have substandard housing units than in metropolitan areas.  Families in urban and rural communities alike are forgoing other important necessities that support a thriving family as they continue to spend more and more on rent each month.

Among families that are ready for homeownership, many face daunting odds of making that dream a reality.  In 2021 alone, home prices increased by 19%, further delaying the purchase of starter homes for new households ready for homeownership.  In the same year, 1 in 7 homes sold in 40 major metropolitan areas were bought by investors, driving up purchase prices by outbidding would-be owner-occupants.  Most of the homes were in Black neighborhoods ravaged by the previous foreclosure crisis in southern and post-industrial Midwest cities. The purchases were fueled by the Federal Reserve’s monthly purchases of $40 billion in agency-backed mortgage securities.  The Fed’s efforts did not benefit the whole housing market equally and exacerbated persistent and stubborn racial wealth gaps. While existing homeowners experienced record growth in home equity of $6 trillion, the Black/White wealth gap grew by $20 trillion, and Whites continue to have 5 times the wealth of Latinos.

We know you appreciate these issues, but we implore you to continue to do more to ensure that housing investments are made in the once-in-a-lifetime reconciliation package so that New Yorkers and Americans everywhere get the relief they need during these troubling times.  The reconciliation package must include:

• Critical funding for local fair housing enforcement to ensure fairness in the housing market so that there are adequate tools to fight against housing discrimination, a clear barrier to homeownership for communities of color.
• First generation down payment assistance to begin to close the nation’s racial homeownership gaps and help New Yorkers of color build family wealth.
• Support for the rehabilitation of distressed homes sitting vacant in communities across the nation through the Neighborhood Homes Investment Act.
• A significant expansion of rental assistance.
• Housing Trust Fund investments to build and preserve critically needed affordable housing units.

We thank you for your continued support on these and other housing issues, and we hope that, with your continued leadership, the final reconciliation legislation will include the important housing investments we have identified.

Sincerely,

Organizations

Individuals  

PDF of NY Reconciliation Letter to Leader Schumer 2022