Rent control, like every other socialist policy, has been tried and has only made problems worse, not better. Yet every generation of socialists believes socialism is the answer. Photo courtesy of StreetEasy.

On June 25, 2026, the Rent Guidelines Board (RGB) voted 7-1 to set the annual rent adjustment for rent-stabilized apartments at 0% for both one-year and two-year lease renewals commencing October 1, 2026, through September 30, 2027, fulfilling Mayor Zohran Mamdani’s campaign pledge to “freeze the rent.” It is the first time in the board’s history, dating to 1969, that a two-year lease has been frozen at 0%; one-year freezes had occurred three times previously under Mayor de Blasio.

The board also set the hotel and single-room-occupancy (SRO) order at 0% for the same 2026-27 period, extending the freeze to every category the RGB regulates that year, including rooming and lodging houses.

Six of the nine board members were appointed by Mamdani before the vote. Owner representative Christina Smyth resigned hours before the final vote, calling the process predetermined. The lone dissent came from Arpit Gupta, a holdover appointee from former Mayor Eric Adams.

New York City has roughly 2.2 million rental units. Of those, about 1 million are rent-stabilized, close to 40-45% of the total rental stock, depending on the year’s survey, and are subject to annual RGB decisions. Nearly half of those stabilized units are occupied by people born outside the US.

Rent controls of any kind are a classic example of misguided socialist economic policies intended to solve a problem while, in reality, making it worse. Ultimately, suppressing rent increases reduces the number of units available for rent by encouraging landlord exit and tenant lock-in. A rent freeze does not simply cap future increases. It widens the gap between what a rent-stabilized unit can legally charge and what it could command on the open market.

As that gap grows, a landlord’s financial incentive shifts away from continuing to rent the unit and toward selling it to an owner-occupant, converting it to a condominium, combining units, or leaving it vacant rather than re-renting it at below-market rates. Each of these outcomes effectively removes the apartment from the rental market, even though the building itself remains.

A tenant paying far below market rent has little financial incentive to leave, so a unit can stop circulating in the rental market while remaining continuously occupied. This “lock-in” effect is among the most consistently documented findings in rent control research.

Stanford economist Rebecca Diamond, with Tim McQuade and Franklin Qian, studied San Francisco’s 1994 rent control expansion using a natural experiment involving near-identical buildings split by a construction-date cutoff. They found that landlords reduced the rental housing supply by 15%, chiefly by selling units to owner-occupants and redeveloping buildings. The same study found that rent control increased renters’ likelihood of staying at the same address by nearly 20%, reduced citywide renter mobility by 20%, and drove a 5.1% citywide rent increase as the lost supply pushed up market rents. A companion paper found the supply reduction was greater among corporate landlords, which have greater access to capital and can more easily exit the rental market.

MIT economist David Autor, with Christopher Palmer and Parag Pathak, reached similar conclusions in a study of the 1995 repeal of rent control in Cambridge, Massachusetts, published in the Journal of Political Economy, another major causal test of the policy’s market effects.

One of the earliest American critiques of rent control was Milton Friedman and George Stigler’s 1946 pamphlet, Roofs or Ceilings? The Current Housing Problem, published by the Foundation for Economic Education. It argued that rent ceilings caused inefficient use of housing and reduced new construction, contrasting San Francisco’s recovery after the 1906 earthquake, when market rents produced no housing shortage despite 225,000 people being left homeless, with the 1946 postwar housing shortage under rent controls, when “wanted to rent” ads outnumbered “for rent” listings by roughly 375 to 10.

Surveys among economists have shown that most agree that rent control causes a reduction in the quantity of apartments supplied. A 1990 survey found 93% of American economists agreed a ceiling on rents reduces the quantity and quality of housing available; 95% of Canadian economists agreed. A more recent IGM Forum poll of leading economists found 81% agreement, with only 2% dissenting. Milton Friedman called rent control among the most universally condemned policies in the field, terming it a policy that produces the opposite of its intended effect.

Jason Furman, who chaired President Obama’s Council of Economic Advisers, said rent control has been about as disgraced as any economic policy in the tool kit. Swedish economist Assar Lindbeck, a self-described socialist, was a longtime critic of the policy on the same grounds.

Recent commentary has tied this research directly to the Mamdani rent freeze. Freakonomics revisited its 2019 episode on the subject in 2025, noting that national rents have risen 26% since Harvard’s Joint Center for Housing Studies last measured the trend. A December 2025 article in Yield PRO linked the Diamond findings directly to Mamdani’s policy, citing the city’s 2023 Housing and Vacancy Survey, which found more than 25,000 rent-stabilized apartments vacant but unavailable for rent.

Governing’s coverage of the broader rent-control debate cited a Journal of Housing Economics estimate that controlled units experienced a 9.4% price decrease, compared with a 4.8% increase for non-controlled units in the same markets, evidence that regulation shifts costs onto the unregulated market rather than eliminating them.

Socialism is like an economic theory invented by a ten-year-old. For example, how do you help people who do not have enough money? Force employers to pay higher wages, which, of course, drives up the cost of products and reduces the number of jobs created. How do you help people who do not have enough food? Take food from farmers and give it away for free, which disincentivizes growing and selling food and can result in shortages or famine. How do you solve expensive rents? Tell some landlords they cannot charge market rates, which results in fewer rental units being available and drives up the prices of those that remain.

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