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Posted on 11/11/2026 9:55:00 PM PST by E. Pluribus Unum
Foreclosures and tighter credit reveal the hidden costs of price controls.
Well, that didn’t take long. New York’s democratic socialist mayor, Zohran Mamdani, has managed to make the city’s already counterproductive rent regulations even worse, and the results are coming in. Mamdani tried for months to steer 38 largely rent-stabilized properties to an affordable-housing buyer. Instead, on Tuesday, the first of the buildings headed to foreclosure auctions.
The troubled portfolio, formerly owned by Emerald Equities, contains about 850 mostly rent-stabilized apartments and carries roughly $250 million in mortgage debt. A prospective buyer offered $110 million last month, and creditors rejected the bid. Risk like that will inevitably show up in underwriting standards.
Roughly 1,600 buildings in New York with rent-stabilized apartments now have expenses exceeding rental revenue, according to the city’s Rent Guidelines Board. Meanwhile, the financing that keeps such properties functioning is becoming harder to obtain. Mortgage originations for buildings in which at least half the apartments have regulated rents fell from $27.6 billion in 2019 to $11.3 billion in 2025. Signature Bank collapsed during that period, and other lenders retreated as interest rates rose and government policies made owning regulated housing less attractive.
A 2019 state housing law sharply restricted landlords’ ability to deregulate apartments and raise rents through renovations or tenant turnover. Mamdani’s rent freeze, a signature campaign promise, compounds the problem. Freezing rents does not freeze the growing costs of a new boiler, insurance, property taxes, repairs or labor.
Fannie Mae and Freddie Mac seem to be responding to Mamdani’s freeze. Fannie is assuming in some underwriting that rents will remain flat for four to eight years while expenses rise at least 5 percent annually, and Freddie paused some lending while assessing the...
(Excerpt) Read more at washingtonpost.com ...
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Clown World.
Looks like 1975.
“Looks like 1975.” Yup. My thoughts exactly. In fact I think I posted a similar comment a few months ago. The Bronx area had numerous “mysterious” apartment building fires after NYC imposed strcit price controls.
Freezing rents does not freeze the growing costs of a new boiler, insurance, property taxes, repairs or labor.
~~~~~~~~~~~~~~~~~~~~~~~~~~~
The solution is simple. Now we must freeze the cost of new boilers, insurance, property taxes, repairs, and labor.
Forward, comrades!
In this kind of environment, the honest landlord cannot operate.
So the good guy will go out of business and only the very worst will keep going.
Bad for the tenants.
I visited NY in 1980ties.
I have requested to see South Bronx.
The area was practically empty, just skeletons of burned out houses. Couple of government projects were the only inhabited places.
And, interestingly to me, these skeletons looked like they were originally very nicely build houses with elaborate facades.
This area looked like some worst bombed out WWII cities, just nothing left.
Looks like Mamdani is trying very hard to duplicate this.
The ESPN did a really good job with the miniseries based on this. They were very close to the real history, with really good casting and plot.
Nobody can afford to subsidize money loosing business.
So the landlord have to somehow cut their loses.
Either ignoring maintenance or even burning place down.
That will likely gets you some insurance money for your effort.
Rent stabilization, together with free medical care and food subsidies are all the very popular socialistic and communistic ideas.
The results are always the same.
Lack of any housing, cheap or expensive.
Long lines for substandard medical care, a top with the need for bribes under the table.
Food shortages, etc.
Well Duh. I learned that in first grade running a Kool Aid stand. It's too bad liberals are too dumb to ever learn it.
Yes, Clown Town.
I just watched a movie last night about NYC in 1981 called “A Most Violent Year”.
About a Brooklyn guy in the heating oil business.
It came out in 2014 and is on Netflix.
Some of the places in the film looked like they were filmed in the South Bronx. It was about how organized crime basically controlled the heating oil distribution in NYC back then. I would recommend it.
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