(WNY News Now) In order to address New York’s persistent housing issue, Governor Kathy Hochul has outlined a number of ambitious plans aimed at lowering the cost of homes for both homeowners and renters. Hochul’s 2025 State of the State address included a number of ground-breaking proposals, such as a $100 million investment to support housing infrastructure, measures to stop rent-price fixing through algorithms, and the establishment of New York’s first-ever revolving loan fund to encourage the development of mixed-income housing outside of New York City.
In her 2025 State of the State address yesterday, Governor Kathy Hochul unveiled a daring plan to lower the cost of house ownership and rental. By investing $100 million to support important housing infrastructure projects, establishing the state’s first revolving loan fund to encourage mixed-income rental development outside of New York City, and passing legislation to combat landlord collusion in rent-price fixing, the governor proposed strengthening the Pro-Housing Community Program. These plans follow the governor’s announcement last week of new initiatives to increase homeownership’s affordability and accessibility for all New Yorkers.
Rising rent and mortgage rates are the main cause of our affordability crisis, and New Yorkers need our assistance, Governor Hochul stated.It’s time to keep up the fight with new policies to make life more affordable for homeowners and renters after passing a historic housing agreement last year.
In last year’s budget, Governor Hochul collaborated with the Legislature to create a historic housing agreement that included enhanced tenant protections and incentives for new building. Governor Hochul’s historic $25 billion, five-year housing plan to develop or preserve 100,000 affordable houses statewide—which has already achieved the milestone of 50,000 affordable homes ahead of schedule—is built upon by the housing agreement. In addition, Governor Hochul has pledged $1 billion to support the city’s most important pro-housing rezoning in its history—the creation of a City of Yes for Housing Opportunity.
Opening Up Local Development
Establish a $100 million pro-housing supply fund in New York State.
The Pro-Housing Community Program, established by Executive Order 30 signed by Governor Hochul in July 2023, encourages other towns to follow suit by rewarding those who are actively trying to realize their housing potential. Governor Hochul established the Pro-Housing Community designation a prerequisite for receiving up to $650 million in state discretionary funds in the State Fiscal Year 2025 Enacted Budget. More than 420 localities from all throughout New York State submitted letters of intent, and 270 locations have been certified thus far. Governor Hochul will establish a $100 million Pro-Housing Supply fund for certified Pro-Housing Communities to help with vital infrastructure projects required to build new housing, like upgrades to the water and sewer systems, in order to further support communities that are contributing to the housing crisis.
Offer Technical Support to Communities to Help Them Become Pro-Housing
Some cities might not be able to create and implement pro-housing policies like simplified permitting processes, updated zoning texts, and master plans if they lack the necessary funding. Governor Hochul will provide new grant funding to provide technical assistance to municipalities looking to boost housing expansion and related municipal development, ensuring that more localities that choose to do so have the capacity to do so.
Simplify the Environmental Assessment for Low-Income Housing Construction
In order to hasten the construction of additional homes for persons and families while enforcing environmental protections, New York is simplifying its laws. Governor Hochul will move forward with a proposed rule that would permit the construction of modestly sized homes, such as some multi-family dwellings with a gross floor space of no more than 10,000 square feet, as Type II, which provides a more straightforward route to completion. This strategy not only expedites the building of desperately needed homes but also tackles the severe lack of affordable housing that regular New Yorkers must deal with. By carefully simplifying the regulatory process, we can speed up the construction of housing and increase its accessibility for both people and families.
Increasing Community Investment
Establish the First Mixed-Income Revolving Loan Fund in New York State
With significant economic investments in upstate New York on the horizon, like Micron’s $100 billion investment in Clay, the state still requires a comprehensive strategy for housing supply in order to meet pressing housing demands and support job expansion. However, upstate communities frequently lack the resources necessary to build mixed-income rental housing, which results in numerous complexes that are ready for permits but cannot obtain funding. Governor Hochul will establish the first revolving loan fund in the state to encourage mixed-income rental development outside of New York City in order to close this gap and open up additional housing. By offering a more affordable and adaptable source of funding than is often offered by market financing, the fund will close gaps in construction financing. After construction is complete and projects have transitioned to permanent financing, the funds will gradually self-sustain through repayments.
New York State Low Income Housing Credits are doubled.
The New York State Low Income Housing Tax Credit Program (SLIHC), which was enacted in 2000 and is modeled after the federal Low Income Housing Tax Credit Program, has been instrumental in promoting the construction of housing for low- and middle-income people. In order to expand the SLIHC program and make it the biggest state low-income housing tax credit program in the United States, Governor Hochul plans to treble the number of tax credits available. Private investment in affordable housing will reach $210 million annually as a result of this measure alone.
Expand Eligibility and Decouple to Unlock Historic Tax Credits
According to current New York State legislation, only specific census tracts are eligible for both the Federal and State Historic Tax credits, and they must be connected to the same investor. These elements unnecessarily discourage investment in housing projects and lower the economic value of tax credits, a problem that is particularly noticeable in upstate New York localities. In order to remove the census tract eligibility requirement and unleash the full value of the tax credits, Governor Hochul will submit legislation.
Encourage Localities to Convert Unused Land into Housing
Purchasing and renovating unused and abandoned properties is a challenge for many communities. Due to years of neglect, many of these sites are in a considerable state of deterioration and are situated in areas without the local economic circumstances required to encourage private sector reconstruction. As a result, the amount of money needed to renovate these homes may be greater than their market value, and the ensuing financial shortage keeps the property from being restored. By proposing to strengthen the current municipal authority to acquire vacant and abandoned buildings and to authorize localities throughout the state to adopt a tax exemption to incentivize redevelopment of these properties into affordable homes, Governor Hochul will better equip communities to combat blight while creating more affordable housing opportunities.
Preserving the affordability of housing
Prohibit Algorithm-Enabled Rent Price Fixing Collusion
Even when an increase in supply or a downturn of the market would naturally drop prices, real estate management software providers are aggressively pressuring landlords to boost rents using confidential data from their clientele. According to recent data, price-fixing algorithms increased rents for tenants across the country by an estimated $3.8 billion in only the previous year. The software businesses publicly advertise that they can assist property owners outperform the market, which distorts the housing market and harms renters during a historic housing supply and affordability crisis. They also make it clear that the algorithms are designed to increase rents. By putting forward a statewide prohibition on the sale or use of rent price-fixing software, Governor Hochul will take steps to safeguard tenants from these practices.
Lower Shelter Rent Taxes for Residents in Mitchell-Lama
The Mitchell-Lama Program funds 105,000 affordable housing units for middle-class and lower-class families. In order to lower their portion of municipal property taxes, Mitchell-Lama complexes are currently eligible for a shelter rent tax abatement. However, rising insurance, utility, and tax increases that jeopardize construction quality and the financial stability of this vital supply of cheap housing are frequently too much to be addressed by the current tax abatement. Governor Hochul will propose legislation to lower Mitchell-Lama shelter rent taxes by at least half in New York City and permit municipal opt-in in the remaining parts of the state in order to bring much-needed relief.
Increase Funds to Preserve and Enhance Supportive Housing
More than 40 years ago, the Homeless homes and Assistance Program (HHAP) was one of the first initiatives in the nation to commit substantial capital funds to building homes, including long-term, affordable, and supportive housing, exclusively for the homeless. Tens of thousands of units have been built since its inception, and today, requests for funding exceed what is available. To meet the growing demand for supportive housing and maintain existing units that provide a safe place to live for many of the most housing insecure and vulnerable New Yorkers, Governor Hochul will increase funding for HHAP.
Boost Supportive Housing Funding
Governor Hochul has made landmark investments to expand supportive housing across New York State, recognizing that stable housing is the foundation for stable health and a stable life. Providers of supportive housing utilize two key State-funded programs to provide vital services to tens of thousands of New Yorkers, such as people with serious mental illness and substance use disorders who would otherwise be homeless. The New York State Supportive Housing Program (NYSSHP) supports more than 20,000 people living safely and steadily in affordable housing, while the Empire State Supportive Housing Initiative (ESSHI) has funded the supportive services and operating costs of more than 9,600 units of safe and permanent housing for individuals and families in need. However, providers of supportive housing have not been immune to the impact of rising costs, which threatens future housing acquisition and their ability to provide the supportive services that make these programs unique and successful in helping people to remain stably housed. To ensure that New York State s supportive housing stock and services remain viable and accessible to those who need them most, Governor Hochul will take steps to stabilize both programs.
Extend Security Deposit Protections to Rent-Regulated Tenants
Market-rate tenants throughout the state of New York State were granted protections for security deposits in 2019. These protections included requiring the return of any remaining security deposits within 14 days of leaving the apartment and enabling tenants to request an inspection to ascertain what needs to be fixed in order to get their money back in full. Rent-regulated tenants were erroneously left out from receiving these important protections. The Governor will propose legislation to grant rent-regulated tenants the same protections for their security deposits as all other tenants.
Help Affordable Housing Access Captive Insurance to Lower Costs
Insurance costs for affordable housing have skyrocketed, with many owners reporting paying higher premiums for less coverage and renters bearing an increasing share of costs. In recent years, private insurance captives, which are similar to self-insurance and allow for tailored risk management, have been created specifically for affordable housing owners. However, these insurance captives often have eligibility standards for participation, which nonprofits may struggle to meet. Governor Hochul will provide assistance to nonprofit affordable housing owners to undertake repairs and other steps needed to be eligible for such captives.
New York State Homes and Community Renewal Commissioner RuthAnne Visnauskas said,New York remains dedicated to fighting the housing crisis. From a new mixed-income revolving loan fund to initiatives to increase supply and keep costs down for renters, these innovative policies and funding commitments will help families find affordable homes in communities across the state. We thank Governor Hochul for her bold vision on housing and look forward to working with our partners on these policies.
New York State Office of Temporary and Disability Assistance Commissioner Barbara C. Guinn said,We thank Governor Hochul for the significant increased investment in affordable and supportive housing to keep vulnerable New Yorkers who have experienced homelessness healthy, safe, and stably housed. New and continuing investments in the development, preservation, and operation of supportive housing will have a meaningful positive impact on our ongoing efforts to address homelessness and benefit communities throughout the state.