Properties Aren’t Property in New York City

By John R. Puri

Saturday, August 15, 2026

 

New York City Mayor Zohran Mamdani has made no secret of what he thinks about his city’s housing supply: He should be in charge. For the benefit of all New Yorkers, of course.

 

Though just 7 percent of rental units are public housing (still too many), Mamdani speaks of the entire market as a public utility to be managed and allocated from Gracie Mansion. He decides how much rents should rise — by zero. He decides which residents owe more in property taxes than the rest. He decides what kinds of developments are built and in what quantities.

 

Seldom mentioned, except as cartoonish scoundrels, are those who ostensibly own the housing stock. To Mamdani, landlords’ preferences for their buildings’ use are simply nefarious plots to be trumped by the will of tenants, embodied by their mayor. His five-year plan for housing occasionally refers to rent-controlled landlords as “property owners.” Neither of those words is an accurate descriptor.

 

John Locke identified the moral basis of property as improvement upon the state of nature, forged by human labor. The essence of property, he wrote, is “Dominion.” Renowned microeconomist Armen Alchian defined this dominion as “the exclusive authority to determine how a resource is used.”

 

The modifier in private property makes it a thicker concept. Alchian reduced it to three elements: “(1) exclusivity of rights to choose the use of a resource, (2) exclusivity of rights to the services of a resource, and (3) rights to exchange the resource at mutually agreeable terms” — the legal ability to control, profit from, and dispose of one’s property. In New York City, buildings subject to rent control or “stabilization,” a euphemism for milder rent control, or all those constructed before 1974, have been drained of every aspect of private ownership.

 

The practical purpose of property rights, Alchian notes, is to allocate scarce resources in a civilized manner. The pre-modern distribution of New York’s regulated properties is evidence that they are no such thing. Accurate prices are replaced by hours spent waiting in line. The wealthiest residents receive the deepest discounts. Turnover is minimal by design, so outsiders are squeezed into the bursting unregulated market.

 

Once an initial lease is signed, landlords lose control of who may or may not occupy their rent-regulated units. If tenants stay put, as nearly all do, managers are required to renew their leases indefinitely. Tenants may also pass on apartments they do not own to any family member, or “family-like” individual with an “emotional and financial commitment” to them, who has lived in the unit for one or two years.

 

For the services they render, landlords may charge only what the city permits, no matter their expenses. The New York City Rent Guidelines Board voted in June to fulfill Mamdani’s rent freeze, despite knowing that operating costs for rent-stabilized buildings had risen by 5.3 percent. A tenth of units are unprofitable by fiat. Last year, 57,000 dilapidated “zombie” apartments sat vacant because they would cost more to fix up than the government would allow them to earn. (The mayor might seize a landlord’s building if they rent without repairs.) And if a tenant does not pay rent, it can take months to more than a year to evict them.

 

Lastly, managers are not free even to dispose of their buildings. Suppose a landlord wants to convert their units into condominiums. They must either convince 51 percent of tenants to agree, or commit to preserving a portion of the building as rent-stabilized apartments. Conversion plans must be reviewed by the New York Attorney General’s office. Also, no existing tenant can be removed so long as they wish to keep renting.

 

What if a landlord wants to move into a unit themselves? They must prove that they plan to use the apartment as their primary residence. They must demonstrate an “immediate and compelling necessity” as to why they require the apartment. And they cannot displace any tenant who is over 62, disabled, or has lived in the unit for more than 15 years, unless the landlord provides them with an “equivalent or superior” apartment at the “same or lower regulated rent” in a “closely proximate area.”

 

All these rules are presented as regulations, not the undisguised “takings” that are prohibited by the Constitution. After the latest round of tightened restrictions was enacted, however, the value of rent-stabilized units plummeted by 40 to 50 percent — destruction without physical contact. If this is not the kind of property abridgment that, in the Supreme Court’s words, “goes too far,” what is?