NY Dirt: Can Tenants Afford a Rent Increase?

The debate over a rent freeze in New York hinges on the argument that tenants in rent-stabilized units cannot afford an increase.

Tenant-side advocates are saying this often. They decried the 3 percent increase approved by Eric Adams’ rent board last year. 

Concern about tenants’ ability to pay is reaching landlords. In data published earlier this month by the NYC Housing Partnership, more than three-quarters of survey respondents, practitioners in for-profit affordable housing, said they’re concerned that residents will be unable to afford the rent increases needed to sustain building operations.

“I think the Mamdani administration has it right that folks can’t afford the rent,” said Malcolm McGregor, chief asset management officer at the partnership. “These folks don’t have stock portfolios, they don’t have other investments that they can tap and use to cover gaps and expenses.”

Other data shows rent collections in city-financed affordable housing are indeed down since the pandemic. There are several theories about why tenants are not paying and not paying in full, but when I reported on this issue earlier this year, many said they believed tenants in affordable housing were legitimately struggling to pay. 

The tenant movement has harnessed much of the frustration felt by lower-income people about their economic conditions. 

“Wealth in this country has predominantly been created by the stock market and owning a home. Tenants don’t own a home and generally are not the people who are investing in the stock market,” said Eli Weiss of Joy Construction. “It’s a politics of anger.”

What does the data say? Citywide, the median income of New York’s renters was about $65,000 in 2024, the most recent year for which the Rent Guidelines Board has collected data. Renters’ incomes rose year-over-year after adjusting for inflation, but also were lower in real terms than in 2019, according to the American Community Survey. 

But the data we have doesn’t differentiate between tenants in market-rate and rent-stabilized units. There’s reason to believe rent-stabilized tenants are at least slightly worse off. According to data from Robin Hood, the same share of market-rate and rent-stabilized tenants are considered to be “in poverty,” although a slightly higher share of rent-stabilized tenants are “low-income” without being considered impoverished. 

Housing is the biggest expense for many. Over half of renter households in New York City are rent burdened, meaning they spend at least 30% of their income on rent. More than one-quarter are severely rent burdened, spending more than half their income on rent. Chantella Mitchell, chair of the Rent Guidelines Board, referred to these statistics when explaining her vote for a freeze. 

The data overall is somewhat opaque. It’s likely that some tenants in rent-stabilized units can afford a modest rent increase and others cannot. (Maksim Wynn, a landlord member of the RGB, said raising rents would cause tenants to just stop paying, paradoxically hurting landlords’ bottom lines.) 

Landlord groups are often pointing to rental assistance as a fix here. But on a larger scale, what would it take to raise the economic status of New York’s renters such that they could all afford these rental increases? An “abundance”-style fix to cut red tape and unnecessary regulation across the city’s economy? Minimum wage increases? A change to job mix? 

New York’s job gains have recently been “increasingly concentrated in low-wage and high-wage sectors,” according to the city’s Economic Development Corporation, “while middle-income occupations continue to shrink.”

What we’re thinking about: What do you think about these issues of affordability and the city’s economic picture? Let me know at lilah.burke@therealdeal.com.

A thing we’ve learned: What’s for dinner? Mayor Zohran Mamdani is hiring a cook who has experience with South Asian and Middle Eastern cuisine to make him meals at Gracie Mansion. The person will be paid $64,500 and report to the senior executive chef and executive sous chef. 

 — Spencer Davis

Elsewhere…

— A woman was arrested Wednesday in a plot to detonate a bomb at the New York State Capitol, The New York Times reports. The woman, who is American and has been living in the Albany area, had shown ties or pledged allegiance to the Islamic State. She has been charged with one count of attempting to provide material support or resources to a designated foreign terrorist organization.

— The Department of Buildings issued new rules Thursday to force building owners to remove scaffolding affixed to their buildings as soon as repairs are completed, in line with legislation passed by the City Council in 2025. DOB is also proposing new rules to allow buildings to use six new sidewalk shed designs — the same designs former Mayor Eric Adams unveiled in November 2025.

— Immigration and Customs Enforcement agents arrested the captain in a deadly boat accident that killed a mother and her 5-month-old daughter earlier this month, The New York Times reports. The captain, Manuel Hernandez, was initially arrested on Aug. 9, the day after the boat capsized, but he was released on $50,000 bail after being charged with two counts of misconduct and neglect resulting in death.

 — Spencer Davis

Closing time

Residential: The most expensive residential sale recorded Thursday was $6 million for a 3,850-square-foot house at 100 6th Avenue in Park Slope. Sarah Sawyer and Philip Morelli with Compass had the listing. The home last sold for $5 million in September 2021.

Commercial: The most expensive commercial transaction was $4.7 million for a 4,550-square-foot, mixed-use property at 909 Union Street in Park Slope. Jacqueline Torren and Charles C Pigott with Corcoran had the listing. The propert last sold for $2.5 million in August 2007.

New to the Market: The highest price for a residential property hitting the market was $9.7 million for a 2,900-square-foot condominium at 111 Murray Street in Tribeca. Michael Passaro with Douglas Elliman has the listing. The unit last sold for $9.3 million in 2019.

Breaking Ground: The largest new building permit filed was for a proposed 66,499-square-foot, 12-story multifamily project at 5-33 47th Avenue in Hunters Point. Fariba Makooi filed the permit on behalf of developer Palwinder Singh. 

— Matthew Elo