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New York’s Housing Underground: A Refuge and a Resource

Between 1990 and 2000, New York City gained 114,000 apartments that were not reflected in the official number of certificates of occupancy the City granted for new construction or renovation.

Chhaya CDC and the Pratt Center for Community Development wrote a report identifying these “phantom apartments” as the city’s housing underground: units that have been created in spaces that are not officially approved for living. They include private homes that have been cut into rooming houses, two-family homes with unauthorized basement apartments that house an illegal third family, unapproved residential conversions of commercial lofts, and other types of unlawful construction.

The report shows that these units are predominantly located in neighborhoods on the outskirts of the city in Queens, Brooklyn, and the Bronx. In these communities, populated by large numbers of recent immigrants, the existence of unauthorized apartments is controversial. Many neighbors view these units as a drain on neighborhood services. The people who live in these units, understandably, see things differently. For them, these units are a necessary crucial resource in a city sorely lacking in affordable alternatives.

The Pratt Center and Chhaya outline how this fact provides the city government with an opportunity. It is possible to legalize these basement units while ensuring public safety, restricting additional density under the zoning code, and ensuring that no neighborhoods will be unduly burdened with overcrowded schools and services. This would allow many of these units, which are currently outside city rules and potentially dangerous to tenants, landlords, and the communities around them, to be made safer and to become part of the city’s formal housing stock.


Chhaya CDC and the Pratt Center offer the following recommendations to bring unauthorized units into the city’s regulatory system. This report, published in 2008, gives historical insight into the ongoing crisis of affordable housing in New York City:

  1. The City should create an “accessory dwelling unit” category within the building and zoning codes, which would allow many of these currently illegal units to be legalized.
  2. The City should offer landlords who agree to legalize their basement apartments as accessory dwelling units a reasonable (e.g., 12–18 month) grace period during which they will not be subject to penalties for illegal occupancy under the Building Code.
  3. The City should offer landlords who offer to legalize their basement apartments for existing tenants at existing reasonable rents technical assistance and financial incentives to make the necessary repairs.
  4. The City and state should enable violations of accessory dwelling unit provisions to be heard in Housing Court, rather than at the Environmental Control Board, thus guaranteeing that landlord and tenant needs are taken into account. The City should also consider community mediation and enforcement, so as not to burden the legal system.
  5. The City should establish community-based task forces in the neighborhoods that have the most unauthorized housing units to follow the impact of the accessory dwelling unit measure and the role that the housing underground plays in other neighborhood issues such as traffic, parking, schools, and hospital usage.
  6. The City should push for passage of legislation requiring all sellers of buildings in the five boroughs to certify that their homes meet all applicable housing, zoning, and building codes before the sale is consummated.
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