Increases Often Match Inflation, Except for These Landlords

One month after Mayor Zohran Mamdani’s rent freeze was approved, City Council members voted themselves an 18.2 percent pay raise after a Mamdani-appointed panel recommended it, citing the cost of living.

That same month, the Water Board raised rates 6 percent, saying its expenses were rising.

Social Security recipients get a cost of living adjustment every year; it was 8.7 percent in 2023 and will be 3.6 percent next year. New York’s minimum wage went up 3 percent this year. New York State Thruway tolls will rise 5 percent in January to cover maintenance expenses.

See a pattern?

Apparently, such increases are justified when costs go up — except for owners of rent-stabilized apartments.

Their operating costs rose 5.2 percent in a year, but they were not allowed to increase rents in leases signed from this month through September 2027. Another freeze is expected next year.

The Rent Guidelines Board’s justification was that tenants can’t afford to pay even 1 percent more. Broadly speaking, is that accurate?

It’s true that typical New Yorkers’ incomes haven’t kept pace in recent years with the Consumer Price Index, which spiked during the pandemic. But the difference between wages and tenants’ cost of living has been small, though you wouldn’t know it from the rhetoric that pervades today’s politics.

Here are the facts.

The median income in New York City rose by 16.3 percent from 2019 to 2024. Adjusted for inflation, that was a decline of only 3.2 percent, the state comptroller reported.

If you look at the average rather than the median for the bottom 90 percent of tax filers, incomes were up 19.2 percent, a real (inflation-adjusted) decline of less than 1 percent.

So, despite the Covid-induced inflation spike, wages in New York City nearly kept pace in the five years ending in 2024. Then in 2025, real wages went up.

The rent board knew this but still froze rents.

“Average wages rose by 2.3 percent after adjusting for inflation, and median renter income also increased slightly,” Rent Guidelines Board chair Chantella Mitchell acknowledged in a statement last spring. “Most boroughs saw gains, although income declined in the Bronx.”

She noted that for the poorest 40 percent of renter households, incomes fell when adjusted for inflation. Consider, however, that a major driver of the city’s 3.4 percent inflation in 2025 was market-rate rents, which rent-stabilized tenants aren’t paying. Why not use stabilized tenants’ real-world costs?

For them, inflation was only 2.7 percent last year. But their landlords’ operating costs rose by nearly twice as much, in large part because of insurance premiums. This winter is shaping up to be an expensive one for heating oil, with the price per gallon expected to skyrocket 34 percent.

All this data can be dizzying. The point is that elected officials, retirees, roadways, utility providers and most wage workers all get increases to account for rising costs, while rent-stabilized landlords now don’t.

“Landlords can afford it” is the Mamdani’s administration’s rationale, but that is only true for buildings in nice neighborhoods and with free-market units. Properties that are fully or largely rent-stabilized are out of luck — and stuck with regulated rents forever.

Even for buildings still in the black, it’s only a matter of time before expenses overtake revenue.

Mitchell, the rent board chair, admitted that owners’ ability to keep up with expenses is “uneven,” but she passed the rent freeze anyway.

“The data point to concentrated financial strain in low‑rent, high‑stabilization buildings, where owners have the least capacity to absorb ongoing cost increases and tenants have the least ability to pay,” her statement said.

What we’re thinking about: All the attention paid to rents in New York City obscures that buying has become much harder than renting.

In 188 metro areas, the income needed to purchase a median-priced home at least doubled from 2020 to 2025, according to the National Housing Conference.

The household income needed to buy a median home in the New York metro area with a 10 percent down payment was $240,000 this summer. To rent a two-bedroom, it was $116,000.