Is NY Rent Stabilization at Fault for Multi-Family Sell-Offs, New Banking Crisis?

Two big headlines out of New York this week have one thing in common – rent stabilization laws that are destabilizing the value of multi-families. One of those stories is about the sale of two multi-million dollar properties for less than half of the purchase price. The other story is about New York Community Bank which suffered a downgrade to “junk” because of commercial loan losses, including multi-family properties that are sinking in value. We’ve heard a lot about the impact of high interest rates on loans for unprofitable office buildings. But this story highlights the negative impact of rent stabilization laws. The headline that caught my eye in The Real Deal read: “Another rent-stabilized haircut, this time with shears.” The investment firm Bentall Green Oak unloaded two properties in upper Manhattan for just $31 million. That’s 64% less than the purchase price of $85 million...(more) ...That’s it for this episode. You can read more about this two-headed monster by following links to the articles in the show notes below. I also encourage you to sign up as a RealWealth member at newsforinvestors.com for more information on how to invest wisely in single-family homes outside of the New York area. It’s free to join and can help you see where it makes more sense to be a landlord. Also, please remember to subscribe to this podcast, and leave a review!   Thanks for listening! Kathy Fettke   Links:   1 - https://therealdeal.com/new-york/2024/02/07/rent-stabilized-nyc-buildings-sell-at-major-discount/   2 - https://www.cnbc.com/2024/02/07/nycb-reignites-banking-industry-commercial-real-estate-fears.html   3 - https://www.mpamag.com/us/specialty/commercial/nycb-raises-capital-for-residential-mortgage-portfolio-amid-market-turmoil/476327