Rent Stabilization Proponents Fail to Learn From the Past

New York’s tenant protection laws are taking us back to the 1970s.

An apartment complex in New York City in a file photo. Mario Tama/Getty Images

Commentary

Of the approximated 2.3 million apartments in New York City, almost a million of them are rent-stabilized. Unlike rent control, where rent prices are fixed, rent stabilization allows increases at a regulated rate. The politicians behind these price controls aim to make housing costs “fairer” for tenants at the expense of landlords. But the unintended result of these policies, as seen in the 1970s, is that landlords will even abandon properties because the costs outweigh the benefits, with whole neighborhoods suffering as a result. Unfortunately, elected officials and their voters often forget these historical lessons. In 2019, New York City expanded rent stabilization. Now, as we repeat past mistakes, we are also repeating the consequences.

Housing Stability and Tenant Protection Act

From a renter’s perspective, a rent-stabilized apartment means lower housing costs than what would occur in the free market. From a landlord’s perspective, owning these units was never the best investment, but there were ways to work around the disadvantages. Before 2019, landlords could get their apartment delisted from rent stabilization by performing gut renovations removing almost everything except the exterior walls. This was very expensive, but it offered a way out.