Un-Addressed: Subletting Market a Shady Pinch-Point in Housing Crisis

In Chelsea, there is often what is supposed to happen, what is written on paper, and then there is always what really happens – the unvarnished truth of life that occurs at the ground level.

Nothing could be more emblematic of that than the culture of subletting apartments and rooms, and how that is causing havoc, and a potential avalanche, in the eviction crisis – an invisible piece of a crisis that overall has gotten great attention.

Subletting is the practice of one person renting an apartment, then charging rent to others – mostly undocumented residents without social security numbers – for the apartment or for rooms in the apartment. In many cases, the person renting the apartment never lives in the apartment, and the landlord sometimes doesn’t even know that other people are living in his or her property.

It’s a tried and true situation that has existed for probably 10 years or more, but has really come out of the shadows as the eviction crisis looms over the city. While much has been written and said and done for those that go through the official channels at Housing Court, those in a sublet situation don’t show up on statistics but they are no less in need of help.

“Chelsea is unique because there is a ton of subletting,” said Mark Rossi, who runs the Chelsea Legal Services clinic for the City at La Colaborativa. “You have one person who has the apartment and has the social security number for the apartment and they sublet that to undocumented folks and it could be 10 or 15 people in one unit. The person renting the apartment is collecting rent from the sublets and then paying, or not paying, the landlord. The people living there and the landlord have no idea what’s going on.”

Rossi said no one has really known how large the sublet market is in Chelsea, but the pandemic and its housing complications have laid it bare.

“It hasn’t been an issue before,” he said. “There is no way to quantify it. It’s impossible. It’s been in the shadows so long. It’s only now out of necessity that people are seeing this and we might be just at the tip of the iceberg right now, realistically.”

Council President Roy Avellaneda, who is also a real estate professional, said this is a problem that should have been addressed years ago. He said so much effort has been made to build more affordable housing, that no one has wanted to take the time to stop and address what’s going on in the existing housing stock.

“There is a black market out there that hasn’t been addressed and should have been,” he said. “It’s a business. You have people who don’t own real estate and go out and get apartments and then sublet them to a bunch of people and that’s their business. They are tying up the apartments and driving up the rents. They’ve exasperated the existing housing stock.”

The evidence is very clear.

As Avellaneda says, any laundromat in Chelsea will have a flier up on the bulletin board advertising rooms for rent.

“Go into any laundromat in Chelsea and there will be fliers up,” he said. “Look at enough of them and you realize it’s the same land, the same phone number and it’s not the landlord…You have a person renting all these apartments from landlords who don’t know or don’t care. Then you have an apartment that costs $2,000 a month and they’re making $3,000 a month subletting it and they own their own house across town.”

Avellaneda said he’s even seen people recently renting rooms in shifts. One man he knew had a bed to sleep in at a sublet for eight hours and then he had to leave. He went to work while another sublet slept in the bed for eight hours. Then, once that shift was over, the man could return to the sublet for his shift again.

It’s those folks that Avellaneda, Rossi and members of La Colaborativa worry about the most when it comes to the eviction crisis because they have no protections or know they do. In large numbers, they slip between the cracks and find themselves in very vulnerable positions – homeless and hungry and literally nowhere to go.

“People getting kicked out of sublets aren’t going to show up at Housing Court or before a judge,” said Avellaneda. “It’s a totally different group of people. How do you attack that?”

That’s exactly the question Norieliz DeJesus of La Colaborativa has sought to answer. Working exclusively on evictions, housing and sublet issues, she and her team often go door-to-door. They hit places where official filings have happened, and they also act on areas where sublets are popular.

“The numbers may show something, but the reality is totally different,” she said. 

She said much of the housing problem now is there are tenant subleases, and extended family situations, and other non-traditional living arrangements that disintegrate in the stress of COVID-19. 

“There are a lot of people that sublease in the community and who out of fear abandon their homes before they get to court,” she said. “They often leave because they’re getting harassed by the landlord at times…It’s really hard to categorize the situations we see because there are so many dynamics, and they don’t show up on paper.”

Meanwhile, a number of those situations do trickle in to the Legal Clinic that Rossi operates with other volunteers as part of Chelsea Legal Aid. They see a lot of sublet issues at La Colaborativa because in the pandemic many have nowhere else to turn.

Rossi said their case is not hopeless.

“All of this doesn’t meant the sublets don’t have rights,” he said. “That person has the right to receive what they bargained for. It’s against the sublessor. The landlord would take a different stance, but it is not a case that is dead on arrival from an advocacy standpoint. I wouldn’t say in a court of law we would win, but we have a basis to seek relief from that standpoint.”

He said taking the matter to court, or mediation, can often allow the landlord to work with the sublets to work out a safe exit strategy or connect to resources that can help pay the rent if the sublessor will not – such as RAFT or the City’s Rental Assistance Fund.

“The takeaway for me is that kind of case is not dead on arrival,” he said.

Said Avellaneda, “We talk about building more affordable housing. However, we are not even talking about taking care of the existing housing stock and those that live there in these situations.”

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