STEVE FORBES: Mamdani’s socialist rent-control puts New York on the road to housing ruin

New York City has just taken another giant step backward.

The Rent Guidelines Board voted 7-1 to freeze rents on roughly 1 million rent-stabilized apartments, handing Democrat Mayor Zohran Mamdani a major political trophy. Mamdani called it a "historic victory." It is nothing of the sort. It is an act of economic vandalism dressed up as compassion.

This is not housing policy. It is price control. And price controls have failed everywhere they have been tried.

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The mayor’s philosophy is no mystery. Mamdani comes from the hard-left, Democratic Socialists of America school of politics: Government knows best, private property is suspect, landlords are villains and markets must be bent to political will. The language may be modern, but the outlook is old: socialize the benefits, demonize ownership, punish investment and then act surprised when shortages and decay follow.

A rent freeze is a form of backdoor expropriation. City Hall does not formally seize the building. It simply tells the owner: your taxes may rise, your insurance may rise, your fuel costs may rise, your labor costs may rise, your repairs may rise — but your revenue may not. That is not fairness. That is confiscation by regulation.

The board’s own process tells the story. One landlord representative, Christina Smyth, resigned before the vote, accusing the panel of disregarding its own evidence and saying the outcome had been predetermined. Mamdani appointed six of the nine members after campaigning on the freeze. The vote was then celebrated as though it were some independent act of civic wisdom. Please. This was political theater with a prewritten ending.

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The facts are unavoidable. New York does not have too much housing. It has too little. The city’s vacancy rate has been near historic lows. Families, workers, students and seniors are not struggling because owners have too much freedom. They are struggling because decades of bad government have made it too difficult, too slow and too expensive to build.

So, what does City Hall do? It attacks the people who provide housing.

Older rent-stabilized buildings are not magical assets that operate without cost. Boilers break. Roofs leak. Elevators fail. Pipes burst. Insurance premiums climb. Property taxes keep coming. Labor and materials cost more every year. A mayor can freeze a legal rent increase, but he cannot freeze Con Edison, insurance companies, plumbers, roofers, interest rates or the tax collector.

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The inevitable result will be less maintenance, fewer upgrades, more distressed buildings and less new rental housing. The owner who was thinking about renovating will delay. The investor who was considering a new project will look elsewhere. The small landlord who has been barely holding on will sell, defer repairs or walk away. Tenants may enjoy a temporary political sugar high, but they will eventually pay in deteriorating buildings and fewer choices.

This is the oldest lesson in economics: when you cap the price of something below its real cost, you get less of it. Freeze rents and you reduce the incentive to supply rental housing. Punish ownership and you get less ownership. Demonize profit and capital flees.

And now the danger is broader than one rent vote. Last Tuesday’s primaries showed that the DSA wing is gaining strength. Mamdani-backed left-wing candidates, including Brad Lander, Darializa Avila Chevalier and Claire Valdez, scored major wins. Their success signals more pressure for the same failed formula: more government control, more hostility to private enterprise, more redistribution, more regulation and more contempt for the people who create jobs, build housing and pay the bills.

If this ideology spreads, New York’s decline will accelerate. The city will become more expensive, not less. The tax base will erode. Construction will slow. Small businesses will suffer. Public services will weaken. More middle-class families will leave. The people hurt most will be the very tenants and working families the left claims to champion.

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New York became great because it was a magnet for ambition, enterprise, risk-taking and upward mobility. It was built by strivers, builders, entrepreneurs, immigrants, financiers, shopkeepers and workers who believed tomorrow could be better than today. It was not built by rent boards pretending arithmetic does not exist.

The answer to New York’s housing crisis is not socialism. It is supply. Build more. Cut red tape. Reform zoning. Speed permits. Reduce taxes on housing. Encourage private capital. Make it profitable to create the homes New Yorkers desperately need.

A rent freeze may win cheers in East Harlem. But cheers do not fix elevators, replace roofs or build apartments. New York needs growth, not grievance. It needs ownership, not class warfare. It needs housing, not socialist slogans.