A homeless woman sits on 5th Avenue at 42nd Street in New York as she tries to stay warm in the cold temperatures. Timothy A. Clary | AFP | Getty Images

A land of four-figure rents and homes that easily costs seven figures, New York City's white-hot real estate and rental prices have recently shown signs of moderating. Unfortunately, the cooler market is unlikely to stave off another crisis already gripping the city: A homeless population that recently skyrocketed to a record high above 60,000 — bedeviling the efforts of city policymakers and advocates who are trying to alleviate the problem. New York City's Department of Homeless Services is certainly throwing lots of money at the problem, but with little immediate result. For fiscal 2016, the agency saw a 20 percent boost in its budget, to more than $1.3 billion. According to experts, the surge in homelessness is converging with another problematic yet all too familiar trend: A lack of affordable housing in one of the most expensive places in the world to live. The construction boom rapidly transforming New York City's skyline and gentrifying its neighborhoods has done little to quell the demand for reasonably priced apartments. From 1994 to 2012, there was a net loss of about 150,000 rent-stabilized units, according to data from New York's Rent Guidelines Board.

NYC Housing Stock Year New Dwelling Unit Permits Completed New Housing Units Newly receiving 421-a exemptions Rent Controlled Stabilized Pre-‘47 Other Regulated Stabilized Post’46 Total regulated 2005 n/a n/a n/a 43,317 747,332 308,007 296,345 1,395,001 2007 31,902 25,510 4,212 n/a n/a n/a n/a n/a 2008 33,911 24,381 4,521 39,901 717,471 308,653 305,777 1,371,802 2009 6,057 22,229 4613 n/a n/a n/a n/a n/a 2010 6,727 24,047 5,895 n/a n/a n/a n/a n/a 2011 8,936 13,984 11,007 38,374 743,528 297,620 243,312 1,322,834 2012 10,334 9,455 10,856 n/a n/a n/a n/a n/a 2013 17,995 12,682 7,890 n/a n/a n/a n/a n/a 2014 20,483 11,867 6,945 27,039 766,296 278,618 263,621 1,335,574 2015 56,528 14,357 5,468 n/a n/a n/a n/a n/a

As a result, a dynamic that began under the two previous mayors, Rudolph W. Guiliani and Michael Bloomberg has grown inexorably worse under Mayor Bill de Blasio. A policy change under Bloomberg denied priority of public rental vouchers to displaced families — creating what homeless advocates called a "revolving door of homelessness" that has yet to abate. "As we reach record homelessness, we also have a housing crisis," said New York City Comptroller Scott Stringer to CNBC recently. "When more than half of New Yorkers spend over one-third of their income on rent, we have a major challenge." Indeed, soaring housing costs have hit New Yorkers hard. During November, the average rental price of a NYC apartment fell by more than 3 percent in both Manhattan and Brooklyn, according to Douglas Elliman. However, the average rental cost remains well above $3,000 per month, underscoring how surging rents have priced a number of city residents out of the market, displacing thousands of families and individuals. According to a recent Housing and Vacancy Survey from the Census Bureau, 56 percent of city households qualify as rent burdened with more than 30 percent of their income going to rent and utilities. Of rent-burdened New Yorkers, the subset of extremely rent burdened pay more than 50 percent of their income toward rent and utilities. Nearly 3 out of every 10 rent-burdened New Yorkers fall into that category. The problem is also largely economic, with city wages shrinking and slack in the city's labor market — where unemployment hovers above the national rate at 5.1 percent. It all makes the nexus between homelessness and a lack of affordable housing more acute, experts say.





A woman begs for change near Herald Square in New York City. Getty Images

"Things are so tight, and people are so marginally stable in their month-to-month tenancies and their doubled-up situations," Shelly Nortz, deputy executive director for policy at the Coalition for the Homeless, told CNBC in a recent interview. "Housing is maxed out, Section 8 [public rent vouchers] funds have a massive waiting list with more people on the edge of homelessness, and the cost of securing an apartment has increased dramatically," Nortz said. Yet Stringer pointed out that the city has the capacity to increase its affordable housing stock. He told CNBC the city has "over 1,000 vacant, city-owned lots in our city that have been vacant for decades — we should be building tens of thousands of units of affordable housing. We need to harness every resource we can to competently combat our homeless crisis." The de Blasio administration has made several efforts to address the city's affordable housing crisis, including bolstering DHS' budget and an initiative called "Home for the Holidays." The program offers up to one year of payments, ranging from $1,200 to $1,800 for rent, to friends and family members of the homeless willing to offer them shelter. City officials are trying to place 5,000 families who have lived in homeless shelters for at least 90 days. The administration has also boosted funding to rental assistance programs and created a legal service that helps strapped tenants fight eviction.

