Costs, paperwork are top problems for residential owners and managers.

Government mandated paperwork is fast becoming the Number One problem for residential owners, as new rules on lead paint, fire safety and facade inspections kick-off the new millennium.

"Since all the new regulations came in, I don't think that the people who don't belong to the owner organizations like SPONY, CHIP and RSA know what to do," worried Edward Korman, an owner who is vice president of Small Property Owners of New York (SPONY), mentioning the Community Housing Improvement Program (CHIP) that works with primarily middle-market ownership, and the Rent Stabilization Association (RSA), which has 25,000 owners from large to small under its wing.

Results from the 1999 Housing and Vacancy Survey show building and neighborhood conditions improving. The ability to deposit disputed rent in court, plus the good economy, has allowed ownership to collects its rents from tenants, generally making more money, and helps owners to maintain their buildings.

"When owners raise rents and collect more money from tenants, they invest more in their buildings," said Dan Margulies, executive director of CHIP. "Housing quality goes with the economy."

There are still apartments where rents are less than $400, but the closer rents come to market, the more the turnover and mobility.

Combined with the spurt of luxury construction, vacancy rates have decreased or remained stable in every price category, except for those units renting for $1,750 or more, where the vacancy rate increased from 3.4 percent in 1996 to 5.7 percent for the current survey.

"These people aren't staying 11 years in their apartments. They are moving to someplace nicer or newer after one or two years," said Margulies.

For the first time, Staten Island has a vacancy rate over 5 percent, but The Bronx also has a continuing vacancy rate over 5 percent. "Now, by the legal definition, we don't have a housing emergency in two boroughs," he said.

Additionally, the vacancy rate for units in the $700 to $799 range, which is a very common price point in the boroughs, remains over 5 percent, advised Margulies.

He also noted that fewer co-ops are being sub-let and are now being owner-occupied, leading to a decrease in those units being available for rent.

Those building owners willing to rent to low income tenants often find themselves caught up in another, unresponsive and snail-like bureaucracy where Korman charges he can lose four months in rent while waiting for tenants to be certified by social services, Section 8, Emergency Assistance Rental Program, Division of Aids Services, or the Jiggets program.

"They take months to process these applications and the property owners don't want to wait," said Korman. "They lose months and months of rents, and while the owners are willing to rent to these individuals, the loss of rents is a major impediment and contributes to the reasons many of these people can't get into housing. In this age of computerization, there is no reason the City can't address and speed up this time-line, other than an apparent desire to allow private ownership to subsidize the already low rents, but it places a further hardship on the housing stock and City's property tax base."

The owners of small or marginal buildings who are trying to properly comply with the numerous regulations are also watching as other city homeowners illegally convert one- to three-family homes into warrens of single room occupancy units. These buildings are threats to the life and safety of the occupants - earlier this month a fire took the life of one such resident - all while collecting unregulated rents amounting to thousands of dollars of off-the-books income. Meantime, the schools are flooded with the children and neighborhood streets are flooded with the cars.

Steven Spinola, president of the Real Estate Board of New York, said they are worried about the bulk zoning initiative that was certified to begin the Uniform Land Use Review Process by City Planning last week.

"We are worried about its effect on housing in Manhattan and elsewhere," Spinola said. "The more we look at it, the more concerned we get. We'd like to slow down the process so we can understand it better. Even the best people in the industry are concerned because it's a critical issue to continue to build the kinds of buildings the market demands. We are also spending time putting together ideas [geared towards] how you create middle income housing.

Architect Amie Gross helps design housing that complies with Local Law 58, the city's adaption of the Americans with Disabilities Act, as well as the ADA itself.

"All units in new buildings have to be handicapped adaptable, so you can go back later and make them fully accessible," she explained. For instance, a bathroom now has to be larger and have the proper blocking in the wall for a later time when grab bars may have to be added.

"As the population ages, these adaptions will be for everyone," Gross said. "Where it becomes problematic in housing is that it makes big bathrooms. In low income and moderate housing, it's so expensive to design housing because of the codes and the building materials." Her office has become expert in using materials that are both low cost and low maintenance.

In Manhattan, finding an apartment has become so costly that those seeking space for themselves are more willing to purchase townhouses with existing rent stabilized or rent controlled tenants with the hopes of gaining complete occupancy in the future.

"Because prices are continuing to go up and they want to live in a location near their schools, that is one of the sacrifices they are willing to make," said Dexter Guerrieri, president of Vandenberg Real Estate, who put three such deals into contract last week. Ranging in price from $1.3 million to $3.1 million and located from 68th Street to 88th Street on the West Side, Guerrieri said "Each buyer is in quite a different place financially, but to get the size and location, each is willing to make that sacrifice." And the floors and gardens they are getting without moving the tenants is already beautiful space.

Attorneys are advising the prospective owners not to count on getting additional vacancies. Despite regulations permitting owners to gain occupancy for their own use, those regulations also protect the elderly and the mentally and physically disabled from displacement.

"We're seeing some success in gaining additional rooms," said Guerrieri. "I'm showing them examples of other owners, and they have to take a leap of faith on some level."

Those leaps include taking a commercial mortgage rather than a personal one, undertaking the various annual notices and inspection provisions of the city, state and federal codes, and recognizing that any system renovation, such as electrical or plumbing, adding yet another layer of regulation compliance when conducted around occupants.

"They have to follow all the guidelines and know what those guidelines are," said Guerrieri.

But even Korman, with all his experience and information at his fingertips, says "I'm confused myself with all the requirements."