It’s not just NYC: Silicon Valley’s left-wing Dems like the sound of Mamdani’s foolhardy “rent freeze” scheme
Photo by Bingjiefu He, CC BY-SA 4.0, via Wikimedia Commons
Greg Ip at the Wall Street Journal explains the dubious economic thinking behind far-left NYC mayoral hopeful’s “rent freeze” that would further choke housing supply, driving up rents. Nonetheless, local groups like SV@Home and local reps Kalra and Lee are fans of Mamdani’s way of thinking.
Rent control or rent “stabilization,” now covering roughly half the city’s units, discourages tenants from moving and landlords from upgrading the quality of units. Eric Kober, a former director of housing planning for the city’s planning department says Mamdani’s rent freeze would make that worse. After a 2019 state law tightened conditions for rent increases, vacancy rates plummeted, he notes. A law last year championed by Mayor Eric Adams did lift some restrictions on building and renovation, but also raised the bar for evictions from even unregulated units.
New York has generally sought to boost supply via subsidies and tax inducements. Mamdani has proposed publicly subsidizing 200,000 more affordable units. But even if he had the funding, such units typically cost far more than their purely private equivalents, in part because of all the attached conditions, such as using unionized labor.
There are limits to what Mayor Mamdani could do. He can only freeze rents on existing, rent-stabilized units. He can be overruled by the New York state Legislature. And during the campaign, he did soften his stance toward private developers. Yet any developer contemplating a new project must consider the risk that a democratic-socialist mayor will seek to rein in its returns. That is not good for supply.
Of course, there’s also the demand side. Mamdani’s promise to raise taxes on the rich and corporations has raised fears he might drive jobs out of the city, which would, at least, ease housing demand.
Read the whole thing here.
Reps Kalra and Lee tried to intensify rent control in CA:
“Kalra’s bill would permanently lower the existing rent control and cost-of-living rate in California from a 15% maximum increase per year, to a 7% maximum increase for tenants. Assemblymember Alex Lee, who also represents parts of San Jose, co-authored the bill, among other state lawmakers.”
Read the whole thing here.
Local advocacy group SV@Home expresses its support for “rent stabilization”:
“Santa Clara County renters continue to face extreme pressure due to high rent increases. Rent Stabilization is an important tool to help mitigate displacement risks. SV@Home supports limits on allowable annual rent increases to a reasonable amount because they increase protections for tenants who experience severe rent burdens and preserve existing affordable housing opportunities in our communities.”
Read the whole thing here.
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