EVERY WEEKDAY, Petya Dimitrova and Mike Hinz spend three hours commuting to and from their jobs in the Hamptons.
The couple used to live in a basement apartment near their jobs, until their landlord declined to renew their lease last year. They were determined to stay close to their jobs and Hinz’s parents in the Hamptons, but with a combined yearly income of about $70,000, they couldn’t find anything affordable in the area. After three months of searching, they found their current apartment, a one-bedroom in Manorville, Long Island, more than 30 miles west of their old place.
Dimitrova and Hinz are members of a growing group of middle-class Long Islanders pushed out of the island’s ritzy eastern towns by record-high home prices and a severe dearth of rentals under $3,000 a month — fueled by a long-standing hostility to building new housing.
But the tide may be turning. In last week’s election, four towns in eastern Suffolk County approved a tax on the wealthy to fund new affordable housing.
The tax, which is likely to take effect next spring in the towns of East Hampton, Shelter Island, Southampton, and Southold, will charge buyers of high-value homes half of one percent of the home’s price — $5,000 for a $1 million home, for example. That money will go into a “Community Housing Fund” that can be used to produce new affordable housing, subsidize down payments for first-time home buyers, or other uses.
The initiative won’t solve the housing crisis on its own. But it shows a surprising appetite for affordable housing in an area veering right: Republicans racked up large margins of victory in eastern Long Island this election, including losing gubernatorial candidate Representative Lee Zeldin, who railed against a separate initiative Governor Kathy Hochul proposed to spur housing construction as a “blatant attack on suburban communities.”
For Dimitrova, an administrative assistant, and Hinz, a shelter dog trainer, their $1,900 rent in Manorville is “just about affordable,” said Dimitrova, a native of Bulgaria.
The price and the long commute are worth it to stay in eastern Long Island, near jobs and family. But many of their friends have left for cheaper housing markets in South Carolina, Georgia, or Europe. Few people are able to wait long enough to snag the elusive affordable housing opportunities: When Dimitrova and Hinz applied for a spot in one of the few subsidized housing developments in the Hamptons, they were told that the wait would be seven years.
“It’s incredibly difficult for young people to stay here,” Dimitrova said.
Planning for Growth
Proponents of the Community Housing Fund hope that it will begin to turn the tide on the affordability crisis.
It will raise at least $20 million a year for the four towns that approved it, estimated state Assemblymember Fred Thiele, who represents the Hamptons and sponsored the law that created the fund. That’s likely enough to allow the East End to add dozens of affordable housing units each year — a significant number, but only a small fraction of the estimated thousands of units that are needed.
“I don’t think we can expect that in the next three or four years we’re going to completely eliminate all the issues with regard to affordable housing, but I think it will be substantial,” Thiele told New York Focus.
The biggest direct beneficiaries will probably not be low-income renters at the bottom of the market, who are unlikely to be able to afford even the subsidized housing created by the funds. The program’s main target is instead people with mid-five-figure salaries who still struggle to find housing in the area. Eligibility for housing created by the fund will be capped by income, but the limits are generous, at about $200,000 for a family, and about $175,000 for a couple or single.
“This looks like a great start from the sense that it is creating a pool of money that can be used flexibly over time,” said Matthew Murphy, director of the NYU Furman Center, a housing think tank.
A document prepared by the Southold town government lists a variety of ways that the town is considering spending the money, including financing new affordable housing developments, paying for the maintenance of existing affordable housing, and providing low-interest loans for homeowners to build small additional housing units on their properties.
“They drew up the legislation in such broad terms that towns can tailor it to their specific goals and needs,” said Scott Russell, the Republican town supervisor of Southold.
But even after the fund’s win at the ballot box, questions remain.
The biggest: Where will local governments allow affordable housing to be built? The East End towns, like many New York suburbs, have strict zoning codes that sharply limit how big buildings can be, and often prohibit apartments.
In Southold, only 226 acres are zoned for high-density residential housing, compared to over 6,000 acres zoned for low-density housing.
These limits are obstacles for affordable housing developers, who generally need to build apartment-style housing to make their projects financially viable.
Developers often ask town boards to raise the density limits for their projects, with a mixed record of success. Southold recently rejected a proposed 24-unit affordable housing development, citing conservation concerns, and residents of Southampton are currently pushing to town board to reject another proposed 60-unit affordable development.
Mike Daly, the founder of pro-development organization East End YIMBY, which spearheaded the campaign in favor of the fund, hopes that towns will identify specific areas where they will allow affordable housing “as of right,” meaning without requiring special permission from the town board.
“Without as-of-right zoning, affordable development can’t happen in any significant way,” he said.
Russell, the Southold town supervisor, said that he hopes to concentrate affordable housing in Southold’s “hamlets,” small areas of the town designated for dense housing.
But this approach may have its limits, he acknowledged.
“If you’re a developer and you’ve only got 20 acres to build affordable housing, everybody’s looking at the same 20 acres of vacant land,” he said. “The competition for the land goes up. So that sometimes prices developers out.”
Zoning changes to allow more housing are likely to provoke local opposition, said Janice Scherer, a town planner of Southampton.
“We have a lot of transplants out on the East End of people who came from New York City, and they do like to close the door behind them and say, ‘No one else should come here,’” she said.
‘This Is Not About Bleeding-Heart Liberals’
On election day, the East End mostly elected Republicans to the state Senate and Assembly.
Some observers might not expect that a largely Republican area would also vote to tax itself to fund affordable housing. But Russell, himself a Republican, wasn’t surprised.
“Affordable housing has always been a bipartisan concern,” he said, noting that he wasn’t aware of any elected official of either party on the East End who didn’t support the referendum.
That’s not to say it didn’t have opponents — it passed in Shelter Island by only 15 votes. “The word ‘tax’ in the voting booth is a dirty word for some people, and they’re just not going to vote for any,” Russell said.
But both Southold, which leans Republican, and the more Democratic East Hampton passed the referendum by wide margins.
Daly said that he consciously attempted to run a non-partisan campaign.
“This is not about bleeding-heart liberals crying that everybody deserves a home,” he said. “Conservatives would say to me, ‘I need employees in my businesses, I want to be taken care of when I go to the doctor, our volunteer firefighter numbers are dwindling.’”
Dimitrova and Hinz hope to return to Sag Harbor one day, perhaps in one of the houses built with the help of the Community Housing Fund. But while Dimitrova praised the fund as a “huge win,” she said $20 million a year is not enough.
“I hope it will bring back the people that have left,” she said. “We need four, or five, or six of those just in order to house people who make, you know, middle-income salaries.”
Photo of Petya Dimitrova and Mike Hinz courtesy of the couple.