Mamdani’s Disastrous Rent Freeze

National Review Online

Monday, June 29, 2026

 

By a 7–1 majority, New York City’s euphemistically named Rent Guidelines Board approved freezing rents in both one- and (this has never occurred before) two-year leases on Gotham’s million or so rent-stabilized apartments. Mayor Zohran Mamdani can now boast that he has delivered on a key campaign promise. A member of the board picked to represent the interests of property owners — after all, that is who landlords are — resigned ahead of the vote. The board, she said, had “stopped being a fact-finding body” and had been rebuilt “to deliver a rent freeze.” Operating behind the hollowed-out façades of more legitimate structures is something the hard left likes to do.

 

The result was a win for Mamdani, but it will be a loss for the city over which he presides. The disastrous consequences of rent control have been known for a very long time. In 1971, the Swedish economist Assar Lindbeck, then a member of his country’s center-left Social Democratic Party, described it as “the most efficient technique presently known to destroy a city — except for bombing,” and he was far from the first to come to a similar conclusion. A rent freeze is rent control on steroids.

 

Rent control, which can come in different forms of which New York’s rent stabilization is only one, is a recipe for social and economic disaster, but it can be a  political success. Regulating — and even more so, freezing — so many rents can be used to buy (and hold) the loyalty of a valuable and voluble constituency and, indeed, induce them to stay in place.

 

As Arpit Gupta, the lone dissenter on the Rent Guidelines Board, has pointed out, rent stabilization should not be regarded as a form of poverty relief. It attaches to apartments of varying types and is unconnected to tenants’ incomes. According to Gupta, some 30 percent of households in rent-stabilized housing earn six figures. When it is convenient for the left’s objectives, such people become “the rich.” Not this time.

 

Under certain circumstances, such tenancies can be transferred in a fashion that effectively creates property rights within someone else’s (the landlord’s) property. This adds to the incentives for existing tenants to stay on in apartments that are, to borrow the language of the density crowd, “too big” for them and pushes up prices for those who have not won the rent-stabilization lottery. Perversely, this will probably work well for Mamdani politically. The mayor’s rise owes a great deal to high rents. For as long as he can persuade unhappy voters that the blame for the cost of their rent rests with capitalist greed rather than municipal socialism, he will continue to reap a rich electoral return.

 

In a market less dysfunctional than New York City, higher rents would attract builders of new rental apartments. Instead, the thought that on top of New York City’s routinely oppressive tax and regulatory burden, their owners might also at some point have to contend with harsh rent controls is an additional disincentive to the construction. Buildings that should have been built will not be built, putting more upward pressure on those outside the rent-stabilized bubble.

 

For some would-be builders, this is no mere theoretical possibility. The price of securing certain property tax abatements on new construction is including a number of rent-stabilized apartments. Applying for such abatements is the builders’ choice, of course, but their choice may be not to build at all.

 

Meanwhile, those unlucky enough to be landlords of a rent-regulated property in New York City are in for a tough time. Typically, theirs is already a low-margin business. Landlords have to employ and hire people to maintain and repair buildings, and pay for supplies and materials — all of which are subject to inflationary pressures. Mamdani is not in a position to freeze many of the rising costs they face even if he had any interest in doing so, which in the case of a class enemy is unlikely. But he is likely to increase those costs that he can affect. There will be no freeze on property taxes.

 

The resulting squeeze on landlords is likely to reduce the value of their buildings, which, among other malign consequences, makes it more difficult to use them as collateral to finance repairs. It doesn’t help that in the past few years landlords have been barred from recouping the cost of refurbishing a rent-stabilized apartment before new tenants move in.

 

It is no coincidence that nearly 60,000 rent-stabilized apartments are vacant in New York City. In some buildings, making up for those missing revenues and other non-covered costs will mean that the rents of apartments that are not rent-stabilized will have to rise. Other buildings may simply deteriorate. If the money is not there, the money is not there.

 

Mamdani has not been shy about his interest in the idea that the city should take over rental properties. In some cases, the inability of landlords — caught in a vise between rising costs and frozen rents — to maintain buildings to the necessary standard will result in their falling into such a state of dereliction that the city will be able to seize them, giving Mamdani the chance to turn the  political fortress he is constructing into something more than a metaphor. This will hurt countless renters, would-be renters, and the city that Mamdani is meant to serve, but omelet, eggs — you know how it goes.