Like any good socialist, Zohran Mamdani is familiar with the Marxist phrase, “From each according to his ability, to each according to his needs.”
Mamdani says he was making $47,000 a year when he moved into his rent-stabilized apartment, which he found on StreetEasy. Maybe he needed a low-rent unit then. But now he makes $142,000, his wife also works, and his parents are wealthy.
Clearly, Mamdani is getting more than he needs. Karl Marx would not approve.
Now along comes Andrew Cuomo, calling on his rival mayoral candidate to give up the $2,300-a-month one-bedroom in Astoria.
Cuomo also pitched “means testing” to screen out high-earning tenants from rent-stabilized housing: To initially lease a unit, a tenant’s monthly income could not be more than 3.33 times the monthly rent. That is, the rent would have to be at least 30 percent of the tenant’s income.
That might sound appealing to critics of rent regulation and even to progressives. Why should more than 1 in 5 rent-stabilized units go to households making six figures?
However, allowing only low-income people to lease these apartments is a bad idea, although not for the reasons that most people think.
Rent stabilization is a fundamentally flawed housing system. It is literally designed to perpetuate the housing emergency.
To give it a veneer of legitimacy by means testing is like painting over mold. It might look better initially, but doesn’t fix the problem. Indeed, mold only gets worse under new paint.
“The problem with rent control is that it addresses a problem rooted in regulations with more regulations,” wrote Michael Hendrix of the Manhattan Institute. “Rent regulations ‘solve’ America’s affordability crisis for a few people, for a short time, at great cost to everyone else.”
The fact that many well-off New Yorkers enjoy artificially low rents — some while keeping beach houses or country homes — is a potent argument to junk the whole system.
But there are better reasons to end it altogether. Rent regulation merely creates winners and losers, reducing vacancy at 1 million apartments to nearly zero. It promotes the deterioration of housing, makes tenants enemies rather than customers of landlords, hinders new construction and stands in the way of a fair and functional housing market.
If that sounds too philosophical, consider the practical arguments against means testing.
Owners of rent-stabilized housing are under the government’s thumb in so many ways. Means-testing deprives them of the right to rent to a tenant of their choice, and adds yet another layer of bureaucracy. The last thing owners need is another hoop to jump through.
Also, it’s usually easier to operate a mixed-income building than one where everyone is barely getting by.
New York actually had a crude form of means testing until June 15, 2019: A landlord could evict tenants from rent-stabilized units by proving that they made more than $225,000 two years in a row.
That was difficult and it rarely happened. Then the 2019 rent reform removed the incentives to vacate a unit. So even if means testing were restored, most landlords would gain nothing by enforcing an income limit.
An asset limit would be even harder to police, as assets are private and easily hidden.
In theory, the state could monitor tenants’ income by looking at their tax returns. If the Division of Homes and Community Renewal provided the tax department with a complete list of rent-stabilized units, the tax office could flag tenants who exceeded an income threshold.
But then what? Who would evict these tenants? Landlords are not going to endure a two-year slog through housing court and pay thousands in legal fees to replace rich tenants with poor ones who pay exactly the same rent.
Traditional affordable housing programs only screen incomes before the initial lease-signing. They don’t kick out tenants who get a raise or a better job. That would be highly disruptive, and a disincentive for people to advance their careers.
If Mamdani left his apartment, it would not guarantee his landlord would rent it to a needier tenant. And forcing unsubsidized landlords to do that is unworkable and possibly unconstitutional.
I don’t blame Cuomo for raising this subject, even though he was dishonest to say that Mamdani’s rental forces a mother and her children to live in a shelter. He is trying to win an election, and his attack has brought attention to a dysfunctional system. Besides, all is fair in love and politics.
But means testing would be a bureaucratic nightmare, and would give a patina of acceptability to an unacceptable system. Perhaps that’s why Cuomo never proposed it during his 11 years as governor.
Read more
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Cuomo’s sad excuses for 2019 rent reform don’t add up
There’s cheap housing right under our noses. Will NYC’s mayoral candidates tap into it?
