The Ill Effects of Rent Control

The Story


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Photo: William_Potter/iStock

New York State radically expanded residential rent control earlier this year, despite warnings that it would stifle the housing market, discourage landlords from improving their properties, and hinder new construction. Though it has been only a few months since the new regulations were passed, negative effects have already emerged. Albany’s regulatory activism will further constrain the rental market, and result in a deterioration of existing stock.

The Facts You Need to Know

  1. Tax: Rent control depresses real estate values, which results in a lower tax base. Read more.

  2. Mortgage: The new regulations have already caused some large property owners to fall behind on their mortgage payments, a first step toward deteriorating conditions. Read more.

  3. Build: Creating incentives to develop is the only way to solve the city’s housing crisis. Read more.

“Fallout from rent regulation accelerates during recessions, suggesting that the effects in New York will become worse when the economy slows.”

Steve Malanga, Manhattan Institute senior fellow

Twitter Take

UPCOMING EVENT


Stay tuned for video and highlights from our special event on RENT REGULATION
in New York City—November 20, 2019.

The Past is Present

The Mayor Who Froze the Rent By Seth Barron (June 30, 2015)

“The legislature agreed to renew the city’s 46-year-old rent stabilization law for another four years but raised the threshold for removing rental units from regulation only from $2,500 to $2,700.”

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