Rent Regulation: Beyond the Rhetoric
In New York City more than one million housing units, representing more than half the private rental market and one‐third the total housing stock, are subject to rent regulation. This scale of regulation is unique among American cities and is highly controversial.
Proponents claim rent regulation protects affected tenants from otherwise likely excessive rent increases in New York’s tight housing market and helps make housing more affordable for low‐ and middle‐income households who otherwise could not live in their own home in New York City. Critics claim the regulations give substantial benefits to upper‐income households who could afford unregulated rents, cause rents to be higher among unregulated units than would otherwise be the case, encourage some families to stay in apartments longer than they otherwise would, curb construction of new housing, discourage landlords from properly maintaining regulated units, and lower property values of buildings with regulated units, thereby depriving the City of New York of property tax revenue.
In 1993 the State Legislature, which authorizes rent regulations, responded to the critics by allowing certain high‐rent units to be deregulated. From 1994 through 2008 at least 190,000 units were removed from regulation, although additions to the regulated stock lowered the net decrease to about 118,000 units. In 2009 and 2010, in response to calls for expanded regulation, legislation was passed by the State Assembly to limit future deregulation and to restore to regulation most of the units deregulated since 1993. In May 2010, Governor David Paterson proposed raising the rent threshold for deregulation and extending regulation for eight years beyond its current expiration in 2011. Legislative deliberation on these proposals is underway.