At least one reader didn’t appreciate my salty take on President Donald Trump’s executive order on housing.
He asked: What was the point of the article? Was it an opinion piece? Why didn’t I mention all the things Trump did in his first term, such as Opportunity Zones?
Perhaps I should have been clearer. Let me boil it down.
First, Trump’s executive order was on reducing Americans’ expenses in general, not just on housing, but I focused on the housing part because we cover real estate. I did not mention Opportunity Zones because they seem unrelated to the executive order. That program will be addressed when the White House and Congress confront the expiration of the Tax Cuts and Jobs Act.
Second, the piece was written with a point of view, as is most of my work. Readers can call it opinion, analysis, or whatever they like.
Third, the premise was that the cost of housing stems largely from local decisions. Local zoning, building codes and the like are beyond Trump’s control. He could use his bully pulpit to get cities and suburbs to allow more housing units, stop jacking up construction wages, or make other reforms, but he cannot force them — nor does he seem inclined to, judging from his repeal in 2020 of the federal Affirmatively Furthering Fair Housing rule.
As for Opportunity Zones, they did spur multifamily projects in those zones by giving their investors a break on capital gains taxes. But that fact alone does not mean the expiring program should be renewed or expanded.
The reason: We don’t know how many of those projects would have happened anyway without that tax break, or if the forsaken tax revenue would have created more housing if spent in some other way. An impartial, comprehensive review is needed.
The ostensible premise of Opportunity Zones was to juice investment in downtrodden areas. By definition, those are not areas where housing costs have soared. Any new housing is better than no new housing, but let’s not pretend the OZ program was designed to address the housing shortage. Projects didn’t even have to include housing to qualify.
Another program could be better targeted to the crisis. To reduce rents and prices, mixed-income housing must be built in tight markets. It’s especially needed where people can move up the economic ladder — in so-called high-opportunity areas, which do not qualify as Opportunity Zones.
What we’re thinking about: Are President Trump and Elon Musk ordering federal employees back to the office because they think it will make them more productive? Or because they want some of them to quit, reducing the size of government? Send your thoughts to eengquist@therealdeal.com.
A thing we’ve learned: The Mapping Prejudice Project was started at the University of Minnesota and is now being done in other regions. Academics and volunteers go through old property records to find and map racial covenants — clauses in property deeds that barred people of color from buying homes. “Covenants and zoning were a dynamic duo of exclusion,” one Minnesota planner told me. “Racial covenants are illegal now, but exclusionary zoning is not.”
Elsewhere…
Jay Martin of the New York Apartment Association bristles at the idea that Big Real Estate controls New York politics and that tenant groups are underdogs.
“I struggle to get meetings scheduled, but somehow I have the power and they don’t? Give me a break,” he recently tweeted.
Referring to the 2019 rent law, he added, “They broke the business model in an attempt to decommodify housing. And it’s working. Hundreds of thousands of people are living in buildings whose only future is a law change or a government bailout.”
I wondered from the outset how residents-only restaurants in Billionaires’ Row towers could stay busy, given that unit owners are often in other cities and, when in New York, can choose from lots of exquisite dining venues.
It turns out, these private restaurants can’t stay busy. In fact, they are often empty, Dionne Searcey reported in an entertaining New York Times story about their talented but underutilized chefs.
One thing that did confuse me is why an editor, under the headline, described the restaurants as a “popular” amenity where “residents only drop in occasionally.” Doesn’t sound too popular to me.
Closing time
Residential: The priciest residential sale Thursday was $11.38 million for a 3,250-square-foot condominium at 160 Central Park South in the Plaza District. The Amadei Hettinger Team at Sotheby’s International Realty had the listing.
Commercial: The most expensive commercial closing of the day was $8 million for a 50,000-square-foot medical office at 2532 Grand Concourse in Fordham.
New to the Market: The highest price for a residential property hitting the market was $18.5 million for a 4,230-square-foot condominium unit at 200 East 75th Street in Lenox Hill. Alexa Lambert at Compass has the listing.
Breaking Ground: The largest new building application filed was for a 28,441-square-foot, five-story, 33-residential unit project at 354 East 28th Street in Flatbush. Permits were filed by Thomas Scibilia of NA Design Studio on behalf of Charles Wurzberger of Candor Capital.
— Matthew Elo