Landlords Sue Over City-Mandated 15 Percent Rent Cut. Property owners in Kingston, New York, argue the city is vastly underestimating its vacancy rate in order to justify ruinous rent cuts.

Reason ^ | November 16, 2022 | Christian Britschgi

[karpov]

To alleviate an alleged housing emergency, officials in Kingston, New York, are mandating a 15 percent reduction in rents. Rental property owners are now suing the city, arguing it failed to meet state requirements for adopting rent control and that the ordered rent reduction amounts to retroactive punishment.

"It's going to bankrupt many [landlords]," Richard Lanzarone, executive director of the Hudson Valley Property Owners Association (HVPOA), says of Kingston's Rent Guidelines Board decision last week to reduce rents by 15 percent for leases signed between August 2022 and September 2023. "If it stands, it'll lead to abandonment, tenant displacement, blight, and the destruction of housing."

In July, Kingston became the first city in the state to take advantage of a 2019 New York law allowing communities outside New York City and its surrounding counties to adopt rent stabilization. That law allows localities to regulate rent hikes in larger multifamily buildings constructed before 1974. About 1,200 apartments in Kingston fall under rent stabilization.

Tenant activists say this is the first time a New York municipality has voted to cut rents. While they pushed for a whopping 30 percent rent reduction, activists still took a victory lap at the 15 percent cut.

"This reduction represents a paradigm shift in how we address the needs of the many over unregulated market conditions," said Michael Tierney, a tenant representative on the board, in a press release.

Property owners are less pleased. Lanzarone says landlords have told him the rent reduction will make their buildings unprofitable or force them into foreclosure.

He tells Reason that today HVPOA is filing an amended complaint against the city in Ulster County Supreme Court, arguing the mandated rent reduction is an arbitrary decision that ignored data showing that operating costs for property owners are rising.

[TornadoAlley3]

Certainly. That is the ruinous intended plan.

[E. Pluribus Unum]

Plank #1 of the Communist Manifesto: Abolition of private property in land and application of all rents of land to public purpose.

https://www.laissez-fairerepublic.com/TenPlanks.html

[Governor Dinwiddie]

Government has no business setting rent rates. That is communism. It is shameful. I guarantee you landlords are not swimming in money. And I bet they have zoning against boarding houses.

[Boogieman]

Hmm, throw up some new interior walls cutting the square footage of each apartment by 15%? Or is the rent tied to the square footage?

[RFEngineer]

They could probably get to an amicable compromise reduction if the city eliminated property taxes and any other taxes & fees for the affected properties.

Anything to help “the people” right?

[ConservativeInPA]

Rent control … yeah that works. Either those in power are absolute stupid $hits, or they want to drive landlords out of business and buy their properties. Alternatively, they are getting “donations” from those that have the money to buy those properties.

[Digger]

Property owners are less pleased. Lanzarone says landlords have told him the rent reduction will make their buildings unprofitable or force them into foreclosure.

Guess who buys up the property. (I hate these globalists)

[George from New England]

This landlord has been hit with a 120% increase on renewal of home owner insurance. Talking extra $5000/year to $7500

Damn govt has no busy here.

[gr8eman]

Funny...commie on commie...vote for commies to get communism. When you get communism as the result of voting for commies, sue the commies you voted for! LOL!!!

[HamiltonJay]

Did the city lower its property taxes by 15%?

Somehow I doubt it.

[bk1000]

This is BS. Sometimes you are screwed, sometimes shrewd. The work-around might be some sort of maintenance fee or convenience fee to make up the difference.

[BookmanTheJanitor]

Just sold a building in California. It was becoming a cash drain as the city kept mandating more and more capital improvements and letting the tenants off without paying rent.
I was happy to be done with it. We had 3 offers on the building - all were from China.

[neverbluffer]

My thoughts exactly...

[thegagline]

I’ve been increasing the deductible each year and shopping around for better rates.

[IYAS9YAS]

We had 3 offers on the building - all were from China.

Should have taken the money and handed the spare set of keys over to a bunch of homeless bums 15 seconds after the money hit your account.

[TexasFreeper2009]

I am guessing they wont get a cut to their property taxes to offset it!!!!

[Oldeconomybuyer]

This worked great in Venezuela.

[G Larry]

Landlords need to take a page from retail and include a monthly "savings benefit" showing a 20% "Absent Marxist savings", that only applies when Marxist policies are not imposed.

Rent = $2400

Absent Marxist Savings -$400

Amount Due = $2000

So, when the Kingston Marxists show up, the "savings" is nullified.....

[Bubba_Leroy]

Inverse condemnation. The city is free to cut rent to zero if they want, they just have to fully compensate the property owners whose properties they are taking.