Those two sweet words are dear to the hearts of many a New York renter. They refer to a historic policy, established in 1943, that intended to protect consumers from rapid inflation by freezing the prices of many things – including rent. When the controls expired in 1947, Congress passed the Federal Housing and Rent Act of 1947 and since then, some New Yorkers have enjoyed the security of limited price raises on their apartments.
New York is the only large city in the USA with rent control, but the myth of little old ladies paying $400 a month for a six-bed luxury apartment is just that – a myth. Only 1.8% of New Yorkers actually enjoy the security of a rent controlled apartment, although 45.4% do live in rent stabilized accommodation where landlords are prohibited from increasing rates by a certain percentage each year. The benefits of rent regulation are obvious – in a city where demand is high and land is pricey, it would be impossible for many families to afford rent without price control. Rent stabilization keeps areas like the Lower East Side diverse – without it, experts estimate that Manhattan would be unaffordable for those on salaries under $90,000 per year.
But critics (and there are many) argue that rent control is far too restrictive and creates an artificial economy in the city and prevents millions of dollars of development. They also argue that it makes finding an apartment much harder for those who are living in unregulated accommodation – because few people wish to leave a rent stabilized property, even if it is inappropriate for their family situation, so the property market stagnates. Adam Davison, of NPR’s Planet Money (an excellent podcast which I highly recommend, even for those who have little grounding in economics), believes that rent control will die out in New York over the next few years – robbing Manhattan of the very diversity so many of us celebrate.
But just as Manhattan looks set to drop its rent controls, Britain is looking to them as a potential answer to housing issues in London. My generation, after all, has been told to expect to rent rather than buy property – and tenants need more protection here than they currently have. The Guardian’s Patrick Collinson recently suggested that rent control could be the answer to the UK’s housing crisis – though he notes that the term was conspicously absent from a recent House of Commons Select Committee report on the private rented sector.
So should the UK look to New York for housing inspiration? Both London and New York seem to share similar housing issues – limited avaiabilty, high demand; limited protection for tenants, high prices for many. Rent stabilization seems to help some in the Big Apple, but those who are unprotected suffer as a result. The issues might not seem to impact British expats in America at this point. Indeed, most expats benefit by being offered luxury accommodation through their jobs, and we students can hope for dorms and apartments run for a student budget. My apartment in New York was thankfully provided by my graduate school, so was more affordable than it would have been on the open market. But, lets not forget that if New York drops rent control, sitcom writers will be unable to set the next ‘Friends’ or ‘Sex and the City’ in beautiful apartments. And if that happens, the dream of a flat in Manhattan might be crushed for future generations of starry-eyed British girls.
Follow Sophie on Twitter @sophiejpitman
