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Rising housing costs in New York City have become a defining issue for voters in the Big Apple’s mayoral elections, but politicians and economists are divided on the right long-term solutions to address the problem.
In theory, a rent freeze seems like a quick and easy answer to tackling the affordability crisis. However, experts say this could hinder the city’s real estate market in the long term by discouraging investment and worsening the affordability of non-rent stabilized units.
During his campaign, Zohran Mamdani, a self-described democratic socialist who is running for mayor on a platform to lower the cost of living for working-class New Yorkers, said more than two million residents live in rent-stabilized apartments that “should be the foundation of economic security.” If elected, he pledged to freeze rents for those tenants and use all available resources to expand affordable housing.
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Shannon McGahn, chief advocacy officer at the National Association of Realtors, warned that rent freezes have historically backfired.
“Developers are reluctant to build in areas where their properties could be subject to rent controls,” said McGahn, who noted there is already a nationwide shortage of about 5 million units.
Residential apartment buildings in the Brooklyn neighborhood of New York. (Michael Nagle/Bloomberg via / Getty Images)
“She [rent freezes] chase away the additional supply that would actually create more low- to mid-range housing,” McGahn said. “The real solution is building more homes – not discouraging the investment needed to create them.”
Those concerns are echoed at the city level, with Kenny Burgos, CEO of the New York Apartment Association (NYAA), warning that the policy could make developers wary of investing in New York.
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“I don’t know of any investor or builder who would want to build in a city where the mayor is threatening to limit revenues and the ability to repay the development of these projects,” Burgos said. “So you’re just going to attract a lot less people to build the housing that we need, and Zohran recognizes that we need it so badly.”
Experts say a freeze on rents could hamper the city’s real estate market in the long term. (Zamek/VIEWpress)
Ed Elson, a business analyst and co-host of the “Prof G Markets” podcast, noted that rental prices are determined by the forces of supply and demand.
“The solution to high rents is therefore to increase supply and encourage more construction. Paradoxically, freezing rents discourages construction, causing rents elsewhere to go even higher,” Elson said.
He described rent freezes as a policy that is “too good to be true” and would ultimately not advance society’s goal of easing the cost of living.
Alex Armlovich, a member of the New York City Rent Guidelines Board (RGB) and senior housing policy analyst at the Niskanen Center, said he supports the goal of expanding affordable housing.
But he also disagrees with Mamdani’s approach because it does not address the free market rental costs that are driving this crisis. The problem is that many of his constituents don’t understand this, he said.
The message of affordability resonates with the people hit hardest by extreme rents, but those people won’t see the relief from these policies, Armlovich said.
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“It’s the market-rate renters who are really suffering and are the most excited and energized by the affordability message, even though the rent freeze won’t affect them. It’s very ironic,” Armlovich said. “The big problem in New York is our free market, right? Regulated rents are doing great.”
Zohran Mamdani during a campaign event at Forest Hills Stadium in the Queens borough of New York, U.S., on Sunday, October 26, 2025. (Victor J. Blue/Bloomberg via Getty Images)
Burgos said the rent freeze is aimed at the most affordable housing in New York City. The proposal to freeze rents targets about 1 million rent-stabilized units, where the average rent is about $1,500, Burgos said, citing data from the 2023 New York City Housing and Vacancy Survey.
Burgos said many buildings in Manhattan have a mix of regulated and free-market units — meaning some apartments are rent stabilized while others are not.
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“So what’s going to happen is if a property owner gets a freeze on half of those units, the cost increases for insurance, property taxes, labor, fuel, everything you can think of, and then get pushed to the market tenants. So your neighbor, your open market neighbor, is going to subsidize the rent freeze in that building,” Burgos said.
There are approximately 1 million rent-stabilized apartments in New York City. (Michael Nagle/Bloomberg via Getty Images)
However, Armlovich applauded Mamdani’s proposal to add 200,000 subsidized housing units, saying this would complement rather than replace the private market and could help alleviate the city’s low vacancy rate, which is key to giving tenants more bargaining power.
“As long as he’s honest about that, that’s very exciting. We can get more supply into the market and increase the vacancy rate. A higher vacancy rate gives tenants bargaining power,” he said. “You want landlords to chase tenants, not tenants lining up for apartments.”
Armlovich noted that without new construction, the city will continue to see low vacancy rates and increasing influence from landlords, driving up market rents.
