A social media troll tweeted at me right after the presidential debate.
Knowing that I (and most logical people) don’t see rent control as a solution to the housing affordability problem, the troll asked if I’d noticed President Joe Biden’s comment about capping rents.
I replied, “Other than that, Mrs. Lincoln, how was the play?”
He understood my implication: Biden’s debate performance was so bad that whatever he said about rent control was irrelevant.
Days later, however, Biden actually released the rent plan that he had forecast. At that point it could no longer be ignored. Even if it were just a campaign ploy, he was still the president — and rent control has gained some traction in recent years. So a slew of industry groups released statements listing all the reasons rent control is a terrible idea.
I also saw one press release supporting the idea, from the far-left group Housing Justice for All. “Families across New York state are struggling to stay in their homes because landlords keep jacking up our rents for no reason but greed,” declared the group’s lightning rod, Cea Weaver, in the release.
You can see why Weaver gets under landlords’ skin — and why she won’t be winning any economics prizes.
Anyone who cites “greed” in a policy argument is being a blowhard. Greed is just a loaded word. A better term is profit motive. It’s what inspires businesses to produce what consumers want and to compete on price — the very driver of our economy.
To cite a basic example, Nabisco doesn’t charge $100 for a bag of Oreos. If it did, people would buy Keebler cookies instead. Despite “corporate greed,” Oreos only cost $4.
Apartments are no different. Rents nationwide have fallen for 11 consecutive months because supply outpaced demand, and housing providers lowered prices to fill their units.
At the same time, rents in New York City edged up — not because its landlords are greedier than those in other states, but because supply was constricted by New York’s government while demand to live here grew.
Weaver would say that poor tenants lose that competition, so the government must step in. Many do need subsidies. But subsidies alone won’t end the housing crisis. It’s too big.
A necessary step is letting developers build more housing without rules that inflate costs for everything from insurance to elevators. If Weaver’s group were truly interested in housing justice for all, it would advocate for lawmakers to do that.
What we’re thinking about: Jay Martin of CHIP, in response to a City Council bill, wrote on LinkedIn: “There is simply no way to comply with Local Law 97 while providing air conditioning and mandated cooling temperatures to every renter in NYC.” Do you agree? Email me at eengquist@therealdeal.com.
A thing we’ve learned: A “cutting-edge, state-backed project at 345 Hudson could be a model for other big buildings sprinting to comply with the city’s building decarbonization law,” according to an article by Canary Media. Actually, we knew that already. Check out Suzannah Cavanaugh’s story from 2022 about that Hines building and three others (separately owned by L+M, Omni and Empire State Realty Trust).
Elsewhere…
— In a poll, 78 percent of Democrats and 58 percent of Republicans said the outcome of the presidential election would influence their decision whether to move abroad. Of course, nowhere near that many Americans will do so.
But the real estate angle here is where they would go. No, not Canada. Too cold, apparently. The top choice for all voters was Portugal, and others on the list included Costa Rica, Mexico, Panama, Italy and Spain. France was Democrats’ fourth choice but didn’t make the top 5 for Republicans or independents. Real Estate Trend Alert conducted the survey.
— New Jersey, which has lots of toll roads, famously opposed New York’s plan for congestion pricing, which would have raised $15 billion for transit improvements. Meanwhile, the state plans to spend a staggering $10 billion widening 8 miles of the New Jersey Turnpike.
Road widening has been thoroughly discredited as a means of relieving congestion because it induces demand. Opponents of the Turnpike project also argue that it will “exacerbate historic injustices on Jersey City and neighboring vulnerable communities.”
— The New York State Association for Affordable Housing is looking for a successor to Jolie Milstein, who is stepping down at the end of the year after a decade as president. The job description calls for “a highly seasoned and capable professional with superior organizational and leadership skills as well as fluency in the world of affordable housing.” Harris Rand Lusk is conducting the search. The position pays $250,000 to $300,000.
Closing time
Residential: The priciest residential sale Thursday was $38.8 million for a 6,240-square-foot condominium at 157 West 57th Street in the Plaza District. Jorge Lopez of Compass had the listing.
Commercial: The largest commercial sale of the day was $99.25 million for a 26,000-square-foot retail space at 2 Times Square. The Real Deal reported in May that the owner was looking for about $90 million.
New to the Market: The highest price for a residential property hitting the market was $24.25 million for an 8,360-square-foot condo at 995 Fifth Avenue on the Upper East Side. Carrie Chiang and Andres Perea-Garzon of the Corcoran Group have the listing.
Breaking Ground: The largest new building application filed was for a 155,155-square-foot, seven-story, mixed-use project at 58-25 Hoffman Avenue in Elmont. Randolph Gerner of Gerner Kronick + Valcarcel, Architects filed the permit.
— Matthew Elo