Zohran Mamdani’s promise to “freeze the rent” was central to his affordability-focused mayoral campaign. But delivering on that promise isn’t something that he can do himself.
Rather, Mamdani will need to persuade or appoint members of the city’s Rent Guidelines Board. The RGB is an independent body that decides on allowable increases for stabilized units. By law, it must do so only after weighing factors like inflation, interest, taxes, energy costs, and vacancy rates.
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Pushing through his rent-freeze plan will be Mamdani’s first big test as mayor. In my conversations with current board members—granted anonymity to speak candidly—it seems likely to be challenging. While none of the three members seemed dead-set against Mamdani’s plans, all saw their legal mandate, and the steep costs that landlords currently face, as a major impediment to getting it done. Striking the right balance between affordability and sustainably maintaining the city’s housing stock seems difficult unless the city meaningfully addresses the factors that affect costs.
The RGB exists to set the maximum allowable rent increase for stabilized apartments, which make up nearly half of the city’s apartment stock. While the mayor appoints all nine members to the board for staggered terms, he cannot remove them unilaterally. Promisingly for Mamdani, eight of the nine members’ terms will have expired when he takes office, enabling him to appoint replacements—unless outgoing mayor Eric Adams fills the seats before then.
In recent years, the board has kept rent increases surprisingly low. One member explained that, “we actually set a record for consecutive one-year increases below the New York City Regional Price Index,” saying that New York is “on track for ten consecutive years of below CPI increases.” In other words, while wages kept pace with inflation, rents did not; they actually declined in real terms.
One factor the RGB considers are net operating expenses—or revenues minus expenses. “Over ten percent of buildings are underwater,” that board member continued. This explains the existence of “ghost apartments”— of which there are an estimated 26,000 vacant units—arising because operating expenses exceed legal rents that owners can legally collect.
Landlord’s needs, combined with legal changes, mean that a nominal rent freeze—a zero percent annual allowable increase—is less feasible. When the RGB voted for a zero percent one-year increase under Mayor Bill de Blasio, the state had “generous allowances for improving apartments and building structures,” a second RGB member told me. But in 2019, Albany passed reforms that reduced owners’ ability to factor costs of renovations and maintenance into rents. The state also repealed exceptions that had allowed landlords to raise rents following a vacancy or for high-rent or -income tenants, which had encouraged owners to renovate and improve units.
There are other constraints. Another member said that the board must “follow economic data” and “cannot prejudge” the merits of a rent freeze. “A long rent freeze would be very financially damaging to the city’s housing stock,” the member said. “There are times when rent freezes are justified . . . but inflation was much lower under de Blasio.”
Landlords’ debt is yet another cost that must be weighed. One board member highlighted how the board found “a fourth of buildings are cash flow negative when debt is factored in,” indicating “a broad range of distress for these buildings.”
The mayor-elect could make a rent freeze more viable by decreasing owners’ property-tax burden. Since taxes are one of the cost factors considered by the RGB, reducing these might allow landlords to continue meeting expenses despite a nominal freeze. But one member was skeptical this would help since even nonprofit operators— who aren’t subject to property taxes—are “facing substantial difficulties.” Asked about the possibility of compensating owners through grants or tax abatements to mitigate the effects of a rent freeze, the member said these would reflect a “dollar-for-dollar transfer which doesn’t solve the underlying problem” of costs.
One solution is to pair a freeze with deregulation that lowers landlord’s costs. One member noted the importance of addressing escalating insurance payments, which “now make up a larger cost category than even fuel.” Mamdani could push Albany to pass reforms that would reduce owners’ liability. Several interviewed members also said New York could reform state and local scaffolding laws that, as the Manhattan Institute has highlighted, account for a “7% increase in affordable housing and other development costs.”
Another approach, one board member said, would be for the city to permit “performance-related increases.” This would let well-maintained buildings raise rents in line with costs, while those with five or more violations per unit would see their rents frozen. This would “punish landlords” that “break the law,” while “incentivizing the 95 percent of owners that maintain their buildings” to recoup costs.
Property owners are watching developments closely. Kenny Burgos, who heads the New York Apartment Association, said that it was imperative that the “Rent Guidelines Board looks at the data” before reaching a decision. Asked if the mayor-elect could face legal action if the board declared a rent freeze despite high costs, he said only that “all options remain on the table.”
Mamdani faces stiff obstacles to fulfilling his biggest campaign promise. But the bigger challenge will emerge if he succeeds: further deterioration of the housing stock, more “ghost apartments,” mounting pressure on non-stabilized parts of the rental market—and no new development to meet demand.
Adam Lehodey is an investigative reporter at City Journal, covering governance, economics, and cultural affairs in New York City.
Photo by Lokman Vural Elibol/Anadolu via Getty Images
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