In what New York Mayor Zohran Mamdani described as a “historic victory” for tenants, New York City housing officials recently approved his rent freeze, which will lock in rents for roughly a million regulated apartments in the Big Apple.
Yet, one board member blasted the decision, accusing the board of ignoring its own economic research to reach a predetermined outcome after Mamdani packed the Rent Guidelines Board with partisans.
“This rebuilt board was required to deliver a rent freeze,” Christina Smyth wrote in a three-page resignation letter. “Everything since has been theater. The hearings, the reports, the public comment, the data. None of it was ever going to change the result.”
Smyth, a real estate lawyer appointed to the board by Mamdani’s predecessor, Eric Adams, was referring to the board’s own research reports, which indicate that net incomes for landlords are falling even as building operating costs are rising faster than inflation.
The board, Smyth said, was “knowingly disregarding its own evidence of rising costs and falling income.”
A quick look at the numbers shows Smyth is right.
Data collected by the board show that the price index of operating costs increased by roughly 33% from 2019 to 2025, as several categories outpaced inflation. Insurance costs saw the steepest increase by far, climbing 150%, while maintenance expenses rose 39% and utility bills increased 31%. Spending on labor, fuel, property taxes, and administrative costs generally tracked overall inflation. Meanwhile, the consumer price index rose by just 24%.
In other words, building operating costs have risen much faster than inflation in recent years. But the picture becomes more complicated when you turn to rent levels in New York City.
While landlords have struggled with surging operating costs, rents for stabilized housing have increased much more slowly. Largely because of the Housing Stability and Tenant Protection Act of 2019, which imposed new restrictions on what landlords could charge, rent for stabilized housing has fallen in real dollars.
The Rent Guidelines Board approved one-year renewal increases of 1.5%, 0%, and 0% (followed by 1.5% after six months) during the pandemic. While rent caps increased in the following years — to 3.25%, 3%, 2.75%, and 3% — rents rose by roughly 15% overall.
That is less than half the increase in operating costs over the same period and well below inflation.
All of this data comes directly from the Rent Guidelines Board, which means that when Smyth says the board is “knowingly disregarding its own evidence,” she is not wrong.
The board has rigged the game in such a way that many landlords can’t make money on their properties. According to data from the NYU Furman Center, the typical rent collected in 2025 from buildings that are more than 90% rent-stabilized was $1,395 per month. That is roughly equal to the operating expenses for those units.
All of this helps explain why landlords are increasingly saying enough is enough.
“Most landlords are walking away from [their buildings],” landlord Adrian Lawrence told the New York Post. “They’re not making a profit and they’re not going [to] put their life savings and investments into these buildings without the ability to make back the money with some profitability.”
Lawrence made those remarks before the Rent Guidelines Board approved the latest freeze.
Many landlords, reading the tea leaves after Mamdani’s victory, had already begun unloading properties at distressed prices in anticipation of even tighter rent restrictions. The board’s latest decision is likely to accelerate the fire sale.
Some supporters argue the freeze is worthwhile “so we can see if it works.” But that’s like jumping off a roof to find out whether gravity exists.
We don’t need an experiment to show that rent control doesn’t work. Price controls have been failing for thousands of years, and the economic costs of rent control have been documented for more than a century.
The Swedish economist Assar Lindbeck famously observed that rent control is “the most efficient technique presently known to destroy a city — except for bombing it.”
The economics are straightforward and can be found in virtually any Econ 101 textbook. Cap rents below market levels, and landlords earn less, making it less attractive to maintain existing buildings or construct new ones. Over time, housing deteriorates, and new supply dries up.
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St. Paul, Minnesota, learned this lesson the hard way. In 2021, the city enacted the nation’s strictest rent control law. Within a year, construction of new housing had stalled, prompting city leaders to walk back their policy, a retreat that only continued year after year.
Mamdani says things will be different in New York, contending that “socialists understand economics” just as well as capitalists. He’ll find that moving the immutable laws of economics is more difficult than leaning on a housing board to ignore its own data.