Ms. Gach.

It isn't much of a relief, but fashion and beauty blogger PJ Gach, who recently took to the internet to try and raise the $7,739 in back rent she needs to pay her landlord to fend off eviction, now has until May 8 to pay up or move out.

When The Observer spoke with Ms. Gach this afternoon—she was heading out of housing court a day after her deadline to pay the back rent—she was cautiously optimistic about getting a few more days.

Ms. Gach's plight—which started when she was laid off as a senior editor from Betty Confidential in November and was unable to make her $1,759 rent payments in December, January and February—has earned her both sympathy and vitriol online (it's also earned her about $500 in donations, though there's little chance that she'll be able to summon the remaining $7,200 in the next week and a half.)

Ms. Gach said that after being turned down for a "one-shot emergency assistance grant" from the city's Human Resources Administration and failing to get any help from her local elected officials or rental-assistance charities, she did the only thing that an unemployed woman without family or significant savings could do—she took to Twitter and the blogosphere. The 21st century equivalent of rent party.

"I've been tweeting my heart out," Ms. Gach told The Observer. "But if worse comes to worse I have someone who will take my dog, then I’ll be homeless. Homeless."

While Ms. Gach has unemployment of $369 a week from her former job and earned enough freelance income to cover her rent in both March and April, she's been unable to amass the stack of cash needed to pay off the back rent, which she said totaled $4,500 before legal and late fees tacked on by the landlord. She's lived in her rent-stabilized Morningside Heights two-bedroom for 13 years.

In the meantime, she also started her own fashion and beauty blog Queen of Style. She's also quick to point out that she's been assiduously hunting for a new job the whole time and appears to be making headway. She's been on a number of interviews, including one that got her a promising follow-up, but her hopes folded along with the publication, which announced it was shutting down two days later.

Much of problem, as Ms. Gach sees it, is that while her middle-class status didn't stop her from falling through the holes of the safety net, it has stopped her from receiving the help that she needs. When she visited the HRA office seeking the one-shot rental assistance grant, she claims that she was told, "you need to get money from your family and friends," an imperative that she said was repeated over and over again, along with "you don't need to be here." After explaining that her parents were dead and her friends unable to pay her considerable back rent, she said they accused her of lying. Ms. Gach—a petite blonde who wore what she described as low-key, preppy clothing to her application appointment—said that while she doesn't want to think that she was discriminated against because of her appearance, she's hard-pressed to understand why else HRA would be so insistent that she didn't need their help. (Ms. Gach describes the experience in more depth, as well as her attempts to seek help from her assemblyman and city councilmember on her blog.)

The HRA, when asked to comment on Ms. Gach's account of events, cited privacy law that prevented them from discussing or commenting on any details of individual applicants' cases.

"An individual applying for an one-time emergency grant must meet eligibility guidelines and comply with mandated appointments as part of the investigative review of his or her application," a spokeswoman wrote The Observer.

The specific income requirements and procedures used in awarding "one shot" deals are unclear, but according to the HRA website, it appears that each office has a great deal of discretion about how to award the grants: "The staff in each of the designated programs is able to evaluate the client's situation and determine the benefit. Since 'One Shots' are evaluated on a case-by-case basis, this information is not advertised."

Many online commentators have also been judging Ms. Gach based on her middle-class lifestyle and appearances. In particular, the fact that she lives alone in a two-bedroom. While Ms. Gach vowed to take on a roommate if she ever gets the back rent situation sorted out, she also defended her decision to live alone, citing the need to be "mentally healthy." Before she lost her job, she could afford the apartment, she said, and lived "very frugally" otherwise.

"They have all these cherries to help you if you fall behind in your rent. But as a single woman with no family, no one wants to deal with you," Ms. Gach concluded of her inability to get help from any of the charities or programs she applied to.

Ms. Gach's predicament may well serve as a lesson that given the unforgiving nature of New York's housing market, it's a  good idea to live beneath, rather than just within one's means, whenever possible. Of course, one of the problems with getting evicted from a rent-stabilized apartment is that the best way to economize is often to stay put.

It's a mansion. On an acre. In Astoria.

During the last few decades, Brooklyn has shaken off the vinyl-clad, working-class outer-borough stigma so completely that it can be hard to remember a time when New Yorkers ever dismissed the borough of Kings as a place you came from rather than went to. Indeed, it may well have eclipsed Manhattan as a exporter of culture, with traces of its handsewn jeans and vintage-style facial hair visible on vaguely artsy twenty-somethings in cities around the globe.

Queens, on the other, hand, is still struggling to shed its dreary outer-boroughness, its reputation as a place where secretaries come back to reasonably-priced studios at night. Despite all the enthusiastic references to fun beer halls and more reasonable rents and short commute times to Manhattan that new residents are likely to whip out, it still feels more like a compromise than a destination.

Definitely not a gut reno.

We never realized just how maligned Queens is until we read a recent Daily News article about how no one wants to buy a stunning, well-appointed Steinway mansion that comes with an acre of land (an acre of land!) in Astoria (the borough's crown gem for goodness sakes!) that is selling for only $2.9 million. (To be fair, a recently-organized group of preservationists and local history buffs wants to buy the mansion and turn it into a museum, but they can't swing the price.)

What's more, the 25-room mansion (a true mansion, not a townhouse calling itself a mansion–we're onto you non-free-standing structures) appears to be in really great shape. This is not one of those "bring your architect" listings. The executrix of the property is even open to selling off the surrounding land separately to make the asking price more palatable.

Maybe we've just had our head in the custom-sifted luxury sand, but $2.9 million sounds like such a steal that we spent a good five minutes convincing ourselves that we could enjoy living in Astoria and another five minutes fantasizing about how we could raise the money. (That said, the order in which we undertook those calculations is fairly revealing.)

Of course there's a library.

After endlessly hearing about how all the rich oligarchs are elbowing each other out of the way to sign contracts for $50 million floor-throughs, it's shocking to see a truly gorgeous $2.9 million property snubbed by buyers—a property that has a full English bar and pub in the basement, a sauna, and a center hall with a 30-foot skylit dome . True, the property did first try for $4.9 million when it came on the market in 2009, which was really something of a reach given that no sale in Queens had even approached that price. But considering the fact that an attached on both sides Park Slope "mansion" recently tried for $25 million, and the Pierre penthouse is asking $125 million, $4.9 million doesn't seem unreasonable at all.

And hyped up as the so-called trophy market may be, we know for a fact that in Brooklyn people are lining up millions to outbid each other on ho-hum townhouses.

Still, the sales prices in Queens are low compared to Brooklyn, even with the luxury towers that never seem to stop rising in Long Island City. In Brooklyn Heights, the townhouse where Truman Capote once lived set a borough record when it sold for $12 million last year. In Queens, it was a Long Island City penthouse that sold for $3.1 million, also last year.

In 2012, the average sales price for an Astoria one-bedroom was $387,786—an all-time high. Which sounds crazy cheap, until you realize just how warped our perspective is in New York and how it's harder and harder for anyone who's not rich, or at least very wealthy, to live here anymore. It's easy to get lost in a haze of good cheer when talking about the luxury market and the celebratory, gee-whiz atmosphere that surrounds every record-setting sale, but maybe we should be glad that for all its proximity to Manhattan, prices in Queens are lagging. After removing ourselves from the rah-rah market mindset, we realized that A.) we don't really want to live in Astoria and B.) we'll never be able to afford a $2.9 million mansion anyway C.) maybe it's not such a bad thing that there aren't enough deep-pocketed buyers to drive up real estate prices in Queens. Now that Manhattan is the most expensive place in the U.S. and Brooklyn is the second most expensive, do we really want Queens to claim third place?

Flood waters have rendered luxury rental 2 Gold Street uninhabitable for the immediate future.

At the outset of the third week since Hurricane Sandy hit, it has become clear that normal in some corners of the city will be a long time coming. From the beginning, it was obvious that rebuilding the homes that burned in Breezy Point, or were washed away by surging sea water in Staten Island, would take many months. But now a number of other New Yorkers, who had expected power, heat and electricity to be restored in a matter of days, are still living without.

City, state and national officials are scrambling to find short- and long-term housing for the many New Yorkers displaced by the storm, begging landlords to help them identify vacant apartments, reports The New York Times.

It's never easy to find housing in New York, with the apartment vacancy rate hovering around one percent in Manhattan and only slightly higher in the outer boroughs. And Hurricane Sandy has taken a number of units out of the running, leaving their former inhabitants desperate to find alternative arrangements so that they can leave shelters and resume some kind of normal life. Displaced tenants range from the residents of luxury buildings like 2 Gold Street in the Financial District, who are being released from their leases in light of the fact that  management cannot say when the structure will be habitable again, to financially precarious tenants of the Coney Island projects.

Moreover, city officials fear that the number of residents seeking shelter may rise sharply as the temperature falls, driving those who have decided to stay in their chilly, darkened homes out in search of heated spaces.

“There’s a huge fear that folks are going to be displaced for the medium and long term,” city housing commissioner Mathew M. Wambua told The New York Times. “We feel a real imperative to have something in place when the second surge comes.”

So officials are asking building owners to help create a clearinghouse of available apartments to supplement other temporary housing—most likely modular units provided by FEMA. In a city where brokers fees, guarantors and extensive credit checks are central parts of the rental process, this is easier said than done.

Some building owners are, apparently, asking if the government will indemnify them for apartment damages and legal costs if must evict tenants. Others want clarification on the city and rent stabilization laws and how they'll apply to short-term tenants. But quite possibly the most vexing thing of all is the fact that FEMA vouchers provide about $1,800 a month, which may prove sufficient in the outer boroughs, but does little to help displaced Manhattanites like the residents of Knickerbocker Village on the Lower East Side.

To complicate matters further, there aren't exactly a plethora of available units to go around, with a handful of large management companies having already used their vacant units to house tenants displaced from their waterdamaged buildings.

“People want to do the right thing,” Charles Dorego, senior vice president of Glenwood Management told The Times. “But they don’t want to inherit a pig in a poke. They asked for indemnity, although I don’t see how a government agency can do that.”

The good news is that a proposal is, apparently, on track to be released soon. How much the proposal will actually alleviate the problem remains another matter.

kvelsey@observer.com

Brad Gair, center, in Indiana in 2005. (FEMA)

It's been a week since Hurricane Sandy hit, demolishing houses in Staten Island and the waterfront communities of Brooklyn and Queens. Tensions have been running high of late, with residents frustrated by the pace it's taking to restore power to their neighborhoods—the basic necessity of life on which all other rebuilding efforts rest.

So it should come as some relief to hear that Mayor Bloomberg and the city are looking to life beyond shelters for residents whose homes are beyond easy repair (or any repair at all). Today Mr. Bloomberg announced that he has appointed Brad Gair as the director of Housing Recovery Operations.

With anger and frustration already palpable in these communities (calling Staten Island the forgotten borough has seldom seemed so apropos), Mr. Gair is stepping into the role with challenges far beyond housing thousands of displaced New Yorkers. Although given that he has more than 20 years of emergency management experience in areas hit by natural and man-made disasters (he oversaw the federal government's recovery efforts in the aftermath of 9/11), he brings ample experience to the task.

"Solving the housing problems created by this storm is an enormous challenge, but we know that the resources exist at a variety of federal, state and local agencies. Brad Gair will help us marshal those resources and coordinate efforts so that we can get help to New Yorkers who need it as quickly and efficiently as possible," Mr. Bloomberg said in a statement.

As the director of housing recovery operations, Mr. Gair will develop an inventory of transitional and temporary housing options and oversee the relocation of displaced New Yorkers, coordinating with federal, state and local organizations including the New York City Housing Authority, the Department of Housing Preservation and Development, the Housing Development Corporation and the Department of Homeless Services.

FEMA trailers are one of the major options being considered by the federal government at the moment. While relief workers are not yet sure how many people need housing, current estimates put the number somewhere between 30,000 and 40,000 families.

The mayor also appointed community recovery directors for each borough: Nazli Parvizi in Brooklyn, Matthew Mahoney in Manhattan, Diahann Billings-Burford in Queens and Haeda Milhaltses in Staten Island.

kvelsey@observer.com

Housing crisis? Piece of cake.

Is Mitt Romney really the man to solve the housing crisis? Well, consider this: Mr. Romney may not have ever struggled "to put food on the table" as folksy politicians are so fond of saying, but he has four houses. Four. So he knows a thing or two about home ownership. And, unlike some homeowners who took out mortgages and couldn't pay them back, Mr. Romney is wealthy enough not to have to take out mortgages (although there's a possibility that he did—the man does have the common touch, at times).

In any event, the Republican candidate has revealed his four-point plan while taking a few swings at Obama, like: "the dream of home ownership is out of reach for many Americans as a result of President Obama’s failed policies and stalled economy."

Because Americans were doing so well with home ownership before Obama took the helm. Ha! Good one! As though the "stalled economy" and, well, the entire economic crisis weren't a largely a result of the fact that many Americans were actually really horrible when it came to assessing risk and making responsible choices about home ownership.

Anyway, Mr. Romney would like to, and we quote: 1) responsibly sell the 200,000 vacant foreclosed homes owned by the government; 2) Facilitate foreclosure alternatives for those who cannot afford to pay their mortgage; 3) Replace complex rules with smart regulation to hold banks accountable, restore a functioning marketplace and restart lending to creditworthy borrowers; and 4) Protect taxpayers from additional risk in the future by reforming Fannie Mae and Freddie Mac.

The Washington Post does a pretty stellar job of pointing out how A) this isn't much of a plan and B) the Obama administration is already doing a lot of these things, like proposing new ways to refinance and modify loans. And, as of Nov. 1, for example, the Federal Housing Finance Agency will enact new regulations that make it a lot easier for homeowners to conduct short sales—a key move to help those with underwater mortgages get out from the untenable housing situations.

Moreover, as the Post points out, the government has a pilot program to convert the foreclosed homes it owns into rental properties, given that's where a lot of the demand is at the moment (people who got caught up in the whole foreclosure business the last time are wary to sign their names to another mortgage—and rightly so in a lot of cases). Besides, selling 200,000 houses is hard to do, particularly considering that banks, who also own a lot of vacant houses, haven't had such an easy time offloading properties—and buyers are often speculators, who are happy to let properties sit vacant until prices rise.

In the end, the "plan" looks like a few nice, though vague, talking points, coming rather late in the game. In any event, it's better than Mr. Romney's 2011 plan. As he told the editorial board of the Las Vegas Journal Review Board last year, he thought that the foreclosure process should be allowed to "run its course and hit the bottom."

Shadowy!

Shadow inventory. It was supposed to be the boogeyman of the real estate bust, thousands upon thousands of unsold properties scattered across the city. Bought or built for more than they were worth, people would hang onto these homes until the market improved, giving a better appearance to the housing supply than actually existed. It's like the difference between the standard and broad rates of unemployment.

No matter. To real estate doyenne and new Brooklynite Elizabeth Stribling, there is no shadow inventory, or so she tells The Times in one of its patented 30-Minute Interviews.

I never quite understood this idea of a shadow inventory — supposedly the apartments that hadn’t been leased in developments. I thought, well, when the market turned down, they will be rented and they’ll come on slowly — which is exactly what’s happening now. The demand for new product and the latest is really out there.

Hurray! Disaster averted. Not quite. The Observer checked in with shadow spook Jonathan Miller and he agreed that indeed shadow inventory was down from what he presumed was about 6,000 units at the peak to about 3,000 units of unsold wanting units today. But he still insists this is a tough trend that could take a few more years to fix.

"This should not signal to people that it is time to go out and start building again," Mr. Miller said. "It's like losing 100 pounds and still being 50 pounds overweight, and then saying it's time to start eating again."

Mr. Miller said we should actually thank the banks for helping out on this count. Because they continued to deny just how much the value of their assets had declined, because it threatened the financial firms own survival. As a result, many properties that would have been foreclosed on and sold off were held onto, converted into rentals and hotels or sold off. There is still plenty out there to worry about, though.

"This is a problem that has been managed by attrition, and we've ended up in a better place than we were, but we're still not out of the woods yet," Mr. Miller said.

mchaban [at] observer.com | @MC_NYC

Raise high the roof beams, Mr. Ratner. (SHoP_

Last week, The Observer looked at Bruce Ratner's plans for a prefabricated Atlantic Yards project—whether he was serious about the project and whether he could achieve the steep 20 percent savings he claimed for the modular building process. A number of real estate professionals were skeptical on both counts, but they all pointed to the developers out-sized investment in prefab technology as an indicator of his seriousness. Now we know just how much of an investment that has been.

Forest City Ratner has spent $3.5 million on research and development for prefab construction, according to The Journal, which dug the number out of its annual report. Since Mr. Ratner began considering prefab apartment towers in 2009, that is more than a million dollars per year. Add to that the lawsuit Forest City helped fight, and this seems like a considerable commitment to this new approach.

This may put to rest claims that the developer was only looking at prefab as a means to break the unions and get a better rate from them on Atlantic Yards. Then again, with 15 towers containing millions of square feet of space, a few million could be but a drop in the bucket if it means bigger labor saving on the future of the site.

The entire project has been predicted to cost $5 billion, so even a 5 percent reduction in costs through labor negotiations could equal $250 million in savings. Even if Forest City Ratner were to spend $50 million researching prefab construction, if it gets the labor unions to bend and build a cheaper traditional building, that would be money well spent.

mchaban [at] observer.com | @MC_NYC

We don't feel so well. (Getty)

For almost five years now, the housing crisis has been a drag on the U.S. economy, the U.S. psyche, the U.S. spirit. It turns out it is also dragging down Americans’ health.

A new study by two economists finds a relationship between the number of foreclosures in a community and the number of hospital visits, according to The Wall Street Journal. Princeton’s Janet Currie and Erdal Tekin of Georgia State University studied residents in Arizona, California, Florida and New Jersey, and they discovered “an increase of 100 foreclosures corresponded to a 7.2% rise in emergency room visits and hospitalizations for hypertension, and an 8.1% increase for diabetes, among people aged 20 to 49.” There has also been a rise in suicides.

The Journal notes that general financial stress could be as much to blame as the housing bubble, but since the two are so intimately intertwined, the case either way seems strong. Furthermore, because there was not a corresponding rise in cancer or elective surgeries at hospitals, it appears that the hospitalizations were more stress related than anything.

There is evidence of these problems outside the states studied, too. The Journal found Patricia Graci, a Staten Island woman whose husband lost his job as a painter in 2008, which led to two years of dwindling savings spent on mortgage payments until nothing was left. "Everything was going downhill. My savings were going down to nothing," Ms. Graci told the daily. "When I realized the money wasn't there anymore, I started getting very anxious and depressed."

Then there is the unfortunate case of Norman Adelman.

In 2008, Norman Adelman of Freehold, N.J., called his lender to ask for a forbearance of three or four months, saying he was about to undergo knee-replacement surgery. The lender complied and Mr. Adelman, who runs a home-energy business, says he began scaling back his work. He underwent needed tests and doctor visits.

After two months of not paying his mortgage, he successfully applied for a loan modification, taking his monthly payment from $2,700 to $1,900. But then the loan was sold—and a new servicer didn't recognize the terms of the arrangement, he says.

Mr. Adelman is fighting the new lender but says he has been in and out of the hospital for the last two years. He never had his knees replaced and is now on antidepressants and antianxiety medication.

"He's deteriorated. He's had sleepless nights," says his wife, Shulamis. "You always have this fear of being thrown out. He's just gotten worse and worse from not sleeping."

So which do we need more—chicken soup or loan modifications?

mchaban@observer.com

Fixer-upper-in-chief? (Reuters)

Good news! Foreclosures are at their lowest levels in four years!

Wait, no, that's horrible news. There are so many delinquent homes out there, the banks don't want to repossess them, and even when they want to, the bottleneck caused by the robo-signing scandal is still holding up the whole party. The Obama administration has a simple solution: Just rent it.

The White House is working on a plan to turn a vast inventory of foreclosed homes into rentals, either privately managed or sold in bulk, according to The Times.

The goal, the administration said, is to stabilize neighborhoods where large supplies of empty, foreclosed properties have hurt property values. In addition, the plan is an effort to clear the nation’s balance sheet of real estate holdings that, because they have been difficult to sell individually, have hung over the housing market and stunted sales of existing homes and new construction.

The Federal Housing Finance Agency, the Department of Housing and Urban Development and the Treasury Department are jointly requesting ideas for sales, partnership ventures or other strategies that would help to unload approximately 250,000 properties owned by Fannie Mae, Freddie Mac and the Federal Housing Administration. Those properties account for about half of all properties that have been foreclosed upon and are still awaiting resale nationwide.

[...]

Greater flexibility in disposing of the houses will have other benefits as well, Timothy F. Geithner, the Treasury secretary, said. “Exploring new options for selling these foreclosed properties will help expand access to affordable rental housing, promote private investment in local housing markets and support neighborhood and home price stability,” he said in a statement announcing the new program.

Plus, it helps diminish the ranks of home owners, should the administration indeed put an end to the mortgage interest tax deduction.

mchaban [at] observer.com | @MC_NYC

Back in September, when Ratner and SHoP principal Gregg Pasquarelli unveiled new designs for the public plaza at the foot of the Barclays Center arena, the architect said he would love to design some of the project's buildings, though his primary concern was executing the masterplan. "SHoP's goal is to make sure it's a beautiful and cohesive whole," he said at the time.

Well, it looks like Pasquarelli will be getting his wish after all, as The Observer has learned the firm has been tapped to design B2, the first apartment building planned for the site, along Dean Street on the southeast corner of the arena.

At that September announcement, Ratner said he planned to have at least one rental building in the ground this year, and possibly two. Yesterday, at a Brooklyn Real Estate Roundtable, Forest City Ratner executive vice president MaryAnne Gilmartin reaffirmed this commitment, if somewhat cautiously, according to The Real Deal:

Gilmartin emphasized the affordable housing elements of Forest City Ratner's master plan for the 22-acre Atlantic Yards site, calling it "one of the more ambitious" affordable housing initiatives the city has seen. The project is slated to eventually have more than 6,400 units of affordable, middle-income and market-rate housing.

The first residential building on the site will be a 50-30-20 project, she said, meaning 20 percent of the apartments will be reserved for low-income tenants, 30 percent for middle-income tenants and the rest for market-rate renters. She said Forest City Ratner hopes to begin construction this year.

Ratner had been more emphatic about apartments being built this year, though an official groundbreaking has still not been set.

This is in part because the project is still in the hunt for financing. Somewhat controversial efforts to find it in China have been going well, And it appears that SHoP's selection, and the design work the firm will undertake, should further help Forest City Ratner secure funding for the project. Development projects in the city and beyond have all struggled with financing since the real estate bubble collapsed. This despite the fact that Forest City Ratner's nearby 80 DKLB is now 97 percent leased, as are many other rental buildings in Downtown Brooklyn.

Whenever and whatever gets built, this is yet another big project for the budding SHoP. Yesterday, the city announced the developer of the first phase of Hunter's Point South, and SHoP will be designing the two apartment towers and a school along with Ishmael Leyva. And the firm continues to work on plans for a large mixed-use housing complex at the South Street Seaport for banker-developer Bill Ackman.

mchaban [at] observer.com | @mc_nyo