Neighbors and tenants of a small Bronx apartment building met up at the local watering hole after a new landlord contacted them saying that he recently purchased the building and that they can expect an almost 50% increase in their rent. Over some bar bites and drinks, the tenants got together and brainstormed over what they could do to fight off the rent increase. The group decided to take steps to each own their apartment unit for just $2,500 each!
They contacted a non-profit organization that decided to pay the landlord $2.6mil for the property in February that would start a five-step journey to the tenants owning their units. Only 11 rental buildings over the past 5 years have taken part in something like this. Called a Limited Equity co-op, or a housing development fund corporation co-op, this is where tenants buy their apartments at prices set by the city, and can sell them for a limited profit. The tenants made this deal happen without any funding from New York City, making it an extremely rare victory and at a crucial time for American’s housing expenses.
The landlord, James Giddings, explained the rent increase was due to higher operating costs, another issue forcing landlords to raise rents on their tenants. As inflation has spiked, landlords have faced rising expenses for labor, fuel and maintenance. Mr. Giddings expressed his happiness for the soon to be owners and wishes them success.