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Editorial: Are cities finally waking up to the housing crisis?

The Editors, Bloomberg Opinion on

Published in Op Eds

In one respect, New York City’s unusual election results this year fit a national pattern: Voters opted to make housing easier and faster to build. Here’s hoping it’s a trend that lasts.

A lack of housing has become a nationwide problem. High prices and mortgage rates have depressed sales. With rent costs outpacing incomes, nearly half the nation’s growing population of renters pays more than 30% of their income on housing. In New York, the rental vacancy rate has plummeted to 1.4% and the homeless population has soared.

At long last, voters seem to be waking up to a problem that research identified decades ago: Policies that protect existing homeowners and other local interests have restricted development and driven up costs. New Yorkers voted to speed up reviews of affordable housing and other modest projects and weaken local council members’ veto power. A zoning reform last year, the city’s biggest since 1961, followed similar proposals in fast-growing cities such as Austin and Minneapolis. California’s governor is overriding mayoral opposition to apartment construction in Los Angeles.

Such measures could provide local leaders with a historic opportunity. New York, by some estimates, needs to build as many as 50,000 units a year, well above its recent pace, to make up for decades of underdevelopment. There are already signs of progress: In the third quarter, developers filed proposals for 11,746 new residential units citywide, 162% higher than the average since 2008. Conversions of vacant office space could produce 17,000 more.

Yet zoning limits and sluggish land-use reviews aren’t the only obstacles. Successfully addressing the housing shortage will require cities to work with state governments and the private sector to prioritize home construction — and occasionally to override competing interests.

Here New York offers several examples of what not to do. One needless constraint is an affordable-housing tax-incentive program passed by the state last year, which imposes higher construction wages and below-market-rent requirements on buildings with 100 units or more. Unsurprisingly, the city has since seen a surge in towers with precisely 99 apartments. The goal should be to reward more units, not to punish them.

 

Similarly, affordable rents require keeping landlords’ costs low. Yet New York’s convoluted property-tax system levies higher rates on large apartment buildings than on single-family homes, thus discouraging density and penalizing renters when the costs are passed on. The state’s unique scaffold law imposes absolute liability on owners and contractors for “gravity-related” worker injuries, thereby inflating insurance, construction and maintenance costs. (A recent study found insurance costs for rent-stabilized apartments climbed 150% from 2019 to 2025.) Nearly every US state is plagued by similarly costly impediments; eliminating them should be a national priority.

Finally, with fewer than half of New York City’s rental units available on the free market, fierce competition keeps rents at near records. Freezing rents for the rest, as Mayor-elect Zohran Mamdani has promised, will only reduce landlords’ capacity to invest in upkeep and drive more properties into financial distress. (A survey of landlords last year found that more than 25,000 rent-stabilized apartments were vacant because their owners couldn’t afford to renovate.) Instead, providing more owners with a gradual path to deregulated rents would give them an incentive to upgrade — and to develop more properties.

If New York were to finally raze some of its homegrown obstacles, perhaps states such as California might revisit the myriad policies — such as decades-old property-tax limits — that benefit homeowners at the expense of new buyers and builders. Another housing boom, for New York and for the nation, is long overdue.

____

The Editorial Board publishes the views of the editors across a range of national and global affairs.


©2025 Bloomberg L.P. Visit bloomberg.com/opinion. Distributed by Tribune Content Agency, LLC.

 

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