Housing program

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The Mitchell-Lama program was launched in 1955 to provide affordable housing in so much desired neighborhoods.

Back in the 1950s and 1960s, vast areas of New York City were in need of urban renewal. These areas include many neighborhoods where, today, many if not most family sized apartments easily cost over $1 million, including Chelsea, the Lower East Side, the Upper East Side and the Upper West Side.

To stabilize these areas and encourage middle-class families to stay in the city, tenements were torn down and 269 Mitchell-Lama developments were constructed in their place.

The apartments were intended for middle-income, working residents, particularly nurses, police officers and teachers.  In exchange for keeping prices low, the buildings received tax breaks and low interest mortgages.

The Mitchell-Lama program produced many rentals as well as co-ops.  However, many of them have navigated the complex process of buying out their mortgages and exiting the system, converting into market-rate co-op or condo buildings.   A number of Mitchell-Lama co-ops have exited the system as well.

The remaining Mitchell-Lama developments are supervised by the NYC Housing and Preservation Department (HPD), organized by borough, or the NYS Division of Housing and Community Renewal.

The big differences between a Mitchell-Lama building and a normal apartment building are as follows.


The purchase price of a Mitchell Lama co-op--known as the equity value purchase price which has no relationship to actual market value. It frequently ranges from $4,000 to $35,000. On the higher end of the scale, the equity purchase price of a one-bedroom apartment in Chelsea's 15-tower Penn South complex is around $70,000--less than a tenth of the $799,000 median price of a market-rate one-bedroom co-op in the neighborhood.

Rents and maintenance are also substantially below market. A more extreme example being a three-bedroom Manhattan co-op with a monthly maintenance of less than $1,000.

Income restrictions

To buy or rent in a Mitchell-Lama building, you must pass an income test that varies according to the number of people you will be sharing the apartment with and the size of the apartment.

At the Rochdale Village co-op in Jamaica, Queens, for instance adults must earn a minimum of 40x the monthly maintenance of around $1,000 on the apartment, but not more than $96,180, to qualify for a 2-bedroom occupied by 2 to 4 people.  

Each year you will need to update your income information. If you exceed the maximum limit, you will not be evicted, but you will pay a surcharge on top of your rent or maintenance.   The surcharge is on a sliding scale and normally tops out at 50%.  So, if your rent is $1,000, the maximum surcharge you will be charged is $500.

Succession rights

Only family members who have been living with the original occupant for at least two years and have been included in annual financial reports can assume ownership of an apartment when the original occupant dies or leaves.

So, what exactly is a Mitchell-Lama?

Named after two politicians, New York State Senator MacNeil Mitchell and Assemblyman Alfred Lama, who sponsored the bill that created it, the program dates back to 1955. That’s when the city cleared sites in formerly rundown parts of town, from Chelsea to the Upper East Side, and developers constructed about 105,000 apartments in 269 Mitchell-Lama buildings.

The housing is made up of income-restricted rentals and limited equity of co-ops. Rents are tied to a tenant’s income, and co-op prices are set so that buyers pay an equity value, which they get back when they sell, meaning there’s no profit to be made. In exchange for keeping these places affordable, the builders get tax breaks and low-interest mortgages. The last Mitchell-Lama was built decades ago.

These days, only about 45,000 Mitchell-Lama apartments are left, two-thirds of which are co-ops.

The reason for the drop is that buildings can exit the program. In the case of co-ops, after the building has paid off the mortgage and either 25 or 35 years has passed (depending on its age), shareholders can vote to leave Mitchell-Lama. For current residents, this means a potential windfall since they can sell their apartments at market rates. In the case of rental buildings, the landlord can take the property out of the program once the mortgage is paid off and 20 years have passed, within certain limits, according to Tenants and Neighbors. And some early Mitchell-Lama buildings carried 50-year affordability requirements.

In 2017, Mayor de Blasio announced a plan to spend $250 million to help 15,000 Mitchell-Lama apartments remain affordable by offering owners tax exemptions and low interest loans in exchange for extending their participation in the program. The Village Voice reports that Mitchell-Lama tenants are concerned that there's still little incentive for landlords to remain in the program.


* To learn more details about the houses of this Program call us and be updated you on the available opportunities from our database of 141 Housing and Preservation Development buildings for almost 60 thousand apartments. Information on 93 buildings for 64 thousand apartments under the control of DHCR, can be obtained by calling us. By the way, in these houses there are apartments surrendered under the 8th program, although there are very few of them.



According to the Housing and Vacancy Survey, in New York in 1999 the total amount of the apartments was 30,387,669. Two thirds of these apartments were leased, the rest were occupied by their owners. The proportion of vacant apartments rented in 1996 was 4.01%, in 1999 it was 3.19%. The largest share of vacant apartments was in Staten Island - 5.82%, the smallest - in Queens - 2.11%.

The cost of living in New York was always high and grew rapidly. In 1999, 24.3% of the tenants spent more than half of their incomes on rent. This was an insignificant progress compared to 1996, since city residents with very low income at that time were more successful in finding work and increasing their earnings. Nevertheless, for this category of tenants, the rent was and is still the heaviest burden on their family budget. In addition, many middle-income individuals who rent housing that do not meet the regulations for lease are also in panic in the face of rising housing costs.

The city has been implementing several housing programs for a number of years to make housing more affordable. Among them are the following.


Public Housing

The New York City Housing Authority has now more than 170,000 apartments, where rent for an apartment is 30% of the total income of the employer’s family. These apartments are actually rented by the city as a wholesale from private owners, and then provides, on preferential terms, to their most needy and vulnerable clients. Recent changes in the federal housing policy will lead to the situation when more working families will occupy these apartments. This will reduce the number of vacancies for very poor families but will increase the number of opportunities for families with modest income.


In Rem Housing

The city owns and operates about 13 thousand apartments expropriated from owners for debts incurred. The people with the lowest income live in these apartments. Since the previous owners actually left their houses and apartments adrift, the condition of this housing stock is the worst in the city.


Eighth program, or Housing Vouchers

More than 100,000 families in New York receive vouchers within the framework of the Eighth Program (Section 8), which entitle these families to rent housing in the private sector but pay only 30% of their total income for it. These vouchers are given only to families with very low income. Many landlords conclude contracts for subsidizing with state (federal, state and city) departments in accordance with a number of other programs.


Tax credit program (low income housing tax credit projects)

Program 80/20 (80/20 Housing) and a number of additional programs related to expropriated housing.

The most important role in the urban housing policy is played by regulation of rent relations. According to the state law, this policy can be implemented if the share of vacant apartments in the city is less than 5%. In 1999, 54.5% of all rented apartments in the city were rented according to the rules of regulation or stabilization of rent (rent stabilized). Since 1997, the rules of lease regulation are not applied to apartments with a rent of more than $ 2,000 and for tenants with an income of more than 175,000 a year, though such people do not seem to be found among those reading information on our website.


Tax Exemptions

Faced with a housing shortage and looming fiscal crisis in the early 1970s, New York State created the 421-a tax exemption to encourage developers to build up the city’s residential stock. The 421-a program grants a partial tax exemption to developers of new construction for a period of 10, 15 or 25 years.

To take advantage of the 421-a program, developers must apply for the benefit in the window between the time construction begins and the building’s Certificate of Occupancy is issued. Co-ops, condos, and rental buildings are eligible—though rental buildings must meet certain rent regulations to be included.

A market rebound in the 1980s prompted the city to create a “geographic exclusion area,” also known as an exclusion zone, between 14th and 96th streets, which limited eligibility for the program to developers who agreed to build affordable units for low income families, either by making 20 percent of their units affordable or by purchasing “negotiable certificates” which were used to create affordable housing elsewhere in the city. A 2003 study by the city’s Independent Budget Office (IBO), though, found that from 1985-2002 only seven percent of the 69,000 units subsidized through the program were available to low or moderate-income families.

The cooperative and condominium abatement program under 421-a provides partial tax relief for condo owners and co-op shareholders to reduce the disparity in property taxes paid between residential Class 2 properties (co-ops and condos) and residential Class 1 properties (i.e., one-, two-, and three-family homes). Under 421-a, tax abatements are applied for by the developer and granted by the city to offer incentives to building and marketing of new units of housing. With a 10-year abatement program, the building and its individual units get relief for the first 10 years of occupancy. Real estate taxes would be lowest in the early years of occupancy and rise each year until the abatement expires.

The beneficiaries of the 421-a program aren’t always the lower- and middle-income families intended by the original lawmakers, however. According to a recent article in the New York Post following an investigation of city tax records, designer Calvin Klein gets a $134,450 annual tax break on his Richard Meier-built Perry Street penthouse. Yankee shortstop Derek Jeter saves $130,000 a year on his $4 million Trump World Tower apartment, and actress Natalie Portman saves $26,300 annually on her $5.8 million condo.


NYC Housing Partnership

New Homes Program

Under this program, the city has already provided more than 15 thousand apartments. In this case, land is sold by the city at a nominal cost. At the expense of the state, subsidies for mortgages in the amount of 10 thousand dollars are provided. Families with an income of 30 to 70 thousand dollars a year can afford houses built for such a program. As a rule, these are houses for two families.


Nehemiah Program

Under this program, a coalition of churches built inexpensive homes for middle-income families. The city usually gives a subsidy of 15 thousand dollars for an apartment and provides land at a nominal price. Families with incomes that are slightly lower than those of applicants for participation in the partnership program, can claim for such a home.


New Housing Opportunities Program - New Hop

Launched in 1997, this Program stimulates the construction of housing for families with an average income. The city provides subsidies and soft loans to developers of such housing through the Housing Development Corporation. The corporation itself receives money from municipal loans.


Alliance for Neighborhood Commerce, Homeownership and Revitalization - ANCHOR

Under this program, the city supported the construction of more than 875 thousand square meters of retail space and more than 300 apartments in free urban areas. This program uses a combination of funds from federal, state, urban and private funds.