New York City landlords are expressing alarm after the city's Rent Guidelines Board voted Thursday to freeze rents on one- and two-year leases for the city's roughly one million rent-stabilized units. This marks the first time the board has applied a rent cap to two-year leases.
Mayor Zohran Mamdani, who championed the rent freeze as a key campaign promise, called the decision a "historic victory for New York City tenants." However, property owners argue that the freeze makes owning and maintaining rent-stabilized buildings increasingly unsustainable due to rising operational expenses.
"Expense items are not proportional to the income the properties generate," said Lav Bauta, a landlord whose firm Zion Equities owns approximately 800 rent-stabilized units in the city. "Rent-stabilized properties incur the same, or greater, expenses as their fair-market counterparts: insurance, wages, supplies, elevator service, utilities, etc. There is no support or control mechanism to cap expenses while incomes have been capped."
According to data cited by Bauta, the median collected rent in a building that is over 90% rent-stabilized was $1,395 per month in 2025, which he stated is "roughly equal to the monthly operating cost of such a unit." He added that this figure does not account for debt service, which is crucial for funding repairs and reinvestment.
The Rent Guidelines Board's decision followed the public resignation of one of its nine members, Christina Smyth, who alleged that the panel disregarded its own data throughout the decision-making process. The board's research indicated that costs for buildings with rent-stabilized apartments increased by 5.3% between April 2025 and March 2026, with further increases of 4.1% projected for the following year. Notable cost hikes included fuel, up 11%, and insurance, up 10.5%.
James Whelan, president of the Real Estate Board of New York, echoed Smyth's concerns, stating that the board "ignored its own data and made a terrible decision." He predicted that the outcome would lead to "less investment in maintenance and repairs, accelerating the deterioration of the housing stock that millions of New Yorkers call home."
Landlord attorney Nativ Winiarsky cautioned that owners struggling with insufficient revenue may be unable to perform necessary repairs, potentially leading to violations, fines, emergency repair charges, tax liens, and in some cases, the appointment of administrators or loss of property.
Critics also pointed to a pre-existing issue where approximately 50,000 rent-stabilized units have been warehoused for years due to owners' inability to afford renovations, which they argue drives up market-rate housing prices due to scarcity.
The Rent Guidelines Board has implemented rent freezes only three times prior in its history, all for one-year periods in 2015, 2016, and 2020, during former Mayor Bill de Blasio's administration. The current decision extends this cap to two-year leases for the first time.
Sam Eshaghoff, founder of West Egg Development, which owns several New York City properties with rent-stabilized units, expressed concern that the rent freeze, in conjunction with rising operating expenses, moves the economic return of owning such buildings closer to zero. "When there is no incentive to build new housing, and we have a housing shortage, the free market tenants will fight for the remaining apartments, and this higher demand will cause the market-rent prices to rise," Eshaghoff stated.
The Small Property Owners of New York, a landlord advocacy group, described the vote as "an absolute farce," while the New York Apartment Association predicted the freeze "will destroy the living conditions for hundreds of thousands of New Yorkers."