Residents Fight Back As House-Flipping Threatens to Destroy East New York, BK
On a Saturday morning in October, around 30 or so people gather for a town hall at a community center in East New York, Brooklyn. The room is largely silent save for the speaker at the podium and the claps and whistles that follow each point that’s made. One of the speakers is Jessica Franco a resident who has rented in East New York for about 6 years and sees this neighborhood as her home. “You can go to school, go to college, get higher education, have a salary of about $95,000 and still not afford to buy a house in your own neighborhood. Isn’t that mind-blowing?” She says and the crowd cheers and nods along with her.
She and her husband make a combined income of $95,000 a year which is more than twice the state average, and yet they can’t afford a home here. And she isn’t the only one. Many of the residents and speakers in attendance have a story just like hers, whether they’re renters who can’t afford to buy a home in their neighborhood or owners who can no longer afford to live there. At the center of this issue in East New York are real estate investors who flip homes. There are grave consequences to this seemingly innocent way to make money and these are the consequences that homeowners in East New York, Brooklyn are reckoning with as they fight against corporate real estate investors that continue to tear through their community.
According to residents and community advocates, House flips change the fabric of this predominantly Black and Latinx community by raising property taxes for everyone in the neighborhood. Ella Barrow, aged 70, is a member of the Cypress Hills Community Board and has been living in East New York for the past 65 years. The biggest change she sees in this area is a lack of affordable housing. “People can’t afford to live in the areas they grew up in,” she says. And a lot of that is due to the increase in bills caused by the appearance of these renovated houses.
It becomes a vicious cycle. The more expensive an area becomes, the more likely homeowners are to sell to home flippers, and the more homes flipped in an area, the more expensive the area becomes tax-wise. According to Alexa Sloan, Community Organizer for the East New York Coalition for Community Advancement, “Most of the homeowners in East New York are paying higher property taxes than Bill de Blasio and folks out in park slope.” Ms. Sloan also states that these flipped homes often sell for three times the amount it was originally bought for.
Ms. Franco noticed that when she looked into the history of a house she and her husband decided to buy. The real estate investor who had flipped their home “had just purchased the house for $190,000.” She says “He sold it to us for $610,000” This was money that the couple had to dip into her husband’s pension to get. Like many others in the area, she believes it’s time to fight back against these home flippers. That’s where this town hall comes in.
State Senator Julia Salazar and Assemblywoman Catalina Cruz are working with the community to create a piece of legislation that legislation that’s aimed at ending this unbridled speculation and flipping of homes that Ms. Sloan likens to the lawless “wild wild west.” Albert Scott, Chairman of the East New York Homeowners Association and the man who’s helped champion this law, explains that this legislation tackles three major areas: “to deter flipping, to eliminate high costs for folks that want to purchase, and to increase taxes on these high-end professional investors”
But will it help? Not every resident is so sure, including Ms. Barrow. After all, these corporations would argue that they aren’t doing anything wrong exactly. East New York homeowners are choosing to sell their homes to them. But that’s only technically true. In reality, these corporations are targeting senior citizens using deceitful and underhanded ways to acquire homes right from under them. Ms. Barrow says that they target these elderly vulnerable populations that don’t know any better. “They knock on your door and say can I come in? Next thing you know you’re signing your house away to these people.” When asked if she feels like they’re scamming people, Ms. Barrow firmly says “Oh yeah. They got a smooth talk.”
During a hearing for a cease and desist order designed to end the harassment, Janet Bruce, describes the circumstances that led to her husband being cornered into selling their home. She and her husband, James Bruce have lived in their home since ’06 and when her husband stayed home from work while recovering from a stroke, real estate investors hounded the sickly man. They encouraged him to “claim hardship” and not pay his mortgage. But when Mrs. Bruce discovered this a year later, it was too late. To get away from the debt the couple had incurred, those same investors who wanted to buy her home suggested a short sale of the house. She received pennies compared to the worth of the house and had to move into a studio apartment while her husband was placed in a nursing home.
There are many more painful stories of harassment and swindling like this one but Albert Scott seems to be hopeful that this legislation will finally keep these real estate investors at bay. One of the best parts about this policy, says Scott is that it’s “for us by us.” It’s a grassroots, community-driven policy that’s shaped by the community’s wants and needs. One of the most integral facets of this law is that it increases taxes on real estate investors looking to flip these homes, therefore deterring them from continuing this practice. The money that’s made from these taxes would go into affordable housing for the neighborhood.
When asked about the prospects for this community and this upcoming legislation, Mr. Scott says he’s particularly excited about the proactiveness of the community. He believes that in the long run, this closeness is what will stop outsiders from coming in and destroying the neighborhood. “If you have stability in housing you’ll invest more into your community.” He says. Residents like Nydia Bonefont seem to agree with this aspect of joining forces. “Going to these meetings is very important. That’s how I was able to keep my home. It’s important for the community to be listening.”
