Atlantic Yards and the cost of delay: "affordable" condos, if ever built, could go to households earning $200K+, nearly double the 2006 estimate

Last year, I wrote about what I called "Atlantic Yards and the problem of time," given that the steady increase in Area Median Income (AMI), which is calculated regionally and used to set levels of affordability, meant that a "low-income" two-bedroom apartment, at 50% of AMI, could rent for $1,500.

In fact, the AMI levels have risen so much that developers of Brooklyn Crossing (B4) and Plank Road (B15) have not sought the maximum rents available for middle-income "affordable" units at 130% of AMI, recognizing they must compete with the market.

The cost of delay also affects the promised 200 on-site "affordable" condos, about which I wrote this week for CommonEdge, noting the failure to guarantee such a promise, which would instead be contingent on subsidies.

I should have pointed out that, even if such units were built, they likely would be aimed for a different, wealthier cohort, given the steady rise in AMI.

When incoming Assemblymember Hakeem Jeffries in December 2006 got the developer's non-binding promise of 200 on-site condos, they likely would've been geared to four-person households earning $106,350. Today, such households could be earning $200,100--hardly the cohort that most deserves the boost. That figure surely would rise by the time any condos were built.

Earlier promises

When the (non-binding) Affordable Housing Memorandum of Understanding (MOU) was signed in May 2005 by developer Forest City Ratner and housing advocacy group ACORN, it offered vague promises regarding homeownership:

Developer and ACORN will work on a program to deve1op affordable for-sale units, which are intended to be in the range of 600 to 1,000 units, over the course of ten (10) years and can be on or off site. It is currently contemplated that a majority of the affordable for-sale units will be sold to families in the upper affordable income tiers.

What did "upper affordable income tiers" mean? When the MOU was signed, 100% of AMI for a four-person household was $62,500, which meant 150% of AMI would be $93,750.

In 2006, 100% of AMI for a four-person household was $70,900, as shown in the graphic below, from a July 2006 presentation by developer Forest City Ratner. That meant 150% of AMI would be $106,350.

From July 2006

And today?

As of 2022, 100% of AMI for a four-person household was $133,400, as shown in the graphic below, from the New York City Department of Housing Preservation and Development. That means 150% of AMI would be $200,100. For two people, it would be $160,200. 

(I highlighted 130% of AMI because that's been the common level at which to set rents. I put an oval around $133,400, because, by multiplying it by 1.5, that becomes 150% of AMI.)

Surely the AMI will have risen further when and if any affordable homeownership units ever get built. It would take regulatory intervention or additional governmental aid to target such units for those earning less.