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IIRC rent control laws were passed in 1946, and rent stabilization in 1969. The laws granting MCI increases came in 1974, so guess yes, there was a problem being addressed in the 1970's that LL's were not investing in their properties due to rent control laws.
As mentioned elsewhere in this thread for those who recall the 1970's saw some pretty dramatic decline in NYC housing. Things played out worst in South Bronx were entire blocks of properties were "torched" for various reasons. Other parts of NYC such as the East Village weren't much better.
I find it odd that owners did not have the ability to pass through capital improvement costs at one point.
Also, there would seem to be a host of other factors that drove the housing abandonment and arson in the South Bronx. It's unlikely to be just rent control since other areas in NYC didn't experience anywhere near the same degree of housing decline. And there were plenty of other US cities that did see urban decay without any sort of rent control. Wasn't the South Bronx already a very poor area by the 1970s, hurt by white flight and a decline in manufacturing?
I find it odd that owners did not have the ability to pass through capital improvement costs at one point.
Also, there would seem to be a host of other factors that drove the housing abandonment and arson in the South Bronx. It's unlikely to be just rent control since other areas in NYC didn't experience anywhere near the same degree of housing decline. And there were plenty of other US cities that did see urban decay without any sort of rent control. Wasn't the South Bronx already a very poor area by the 1970s, hurt by white flight and a decline in manufacturing?
As one said there were other things going on in the backround during the 1970's. However there was also the fact LLs could get more for their property by buring it down than fixing it up and renting.
Regarding not being able to recoup capital investment outlays, isn't that surprising. Rent control laws then later rent stabization were meant to deal with an "emergency" a shortage of rental housing and curb some of what were seen as abuses by landlords. As with many laws then and after it is only in subsequent years that things crop up which require attention.
NYS and NYC were under no illusions rental property owners wouldn't like RC or RS, but as still going on today it is like a game of "whack a mole"; every time a new law or rule is passed, landlords find another way to get what they want.
You also have to remember rent control laws were sold as a temporary measure to address then current problems. Decades later the laws are still on books and now have morphed into a "affordable housing" program.
Had the City, State and Federal law enforcement agencies taken action against these predatory landlords and arsonists by giving them prison time, things would not have gone to the lengths they went to in the Bronx, but politicians and judges, were in the same organized crime pockets as the arsonist landlords.
It was not rent control that destroyed the Bronx, but greedy conspiratorial landlords and their complicit police chefs, judges, police commissioners and DA's.
And just like in the 2008 criminal conspiracy that nearly brought down the economy, nobody was ever called to account.
As one said there were other things going on in the backround during the 1970's. However there was also the fact LLs could get more for their property by buring it down than fixing it up and renting.
Regarding not being able to recoup capital investment outlays, isn't that surprising. Rent control laws then later rent stabization were meant to deal with an "emergency" a shortage of rental housing and curb some of what were seen as abuses by landlords. As with many laws then and after it is only in subsequent years that things crop up which require attention.
NYS and NYC were under no illusions rental property owners wouldn't like RC or RS, but as still going on today it is like a game of "whack a mole"; every time a new law or rule is passed, landlords find another way to get what they want.
You also have to remember rent control laws were sold as a temporary measure to address then current problems. Decades later the laws are still on books and now have morphed into a "affordable housing" program.
It would seem to me that rent control/stabilization is being used as a scapegoat for the South Bronx issues in the 1970s. Perhaps some landlords could have better weathered the housing market decline if they had better cash flow in the decades prior. But the fact is they were seeing a change in their tenant demographics as the middle-class was moving away and being replaced by lower-income minorities. The income outlook was different, rent control or not, which would have discouraged further capital investment. Landlords also had issues with financing due to redlining.
Sure, landlords will always try to find a way to get around things. Many look to maximize profits without regard to the tenants. Understandable of course, that is how capitalism works and we see this across many other industries as well. But there is a reason why governments step in and why we have so many environmental, safety, and health regulations. There is a need to offer some protection to the public.
The current regulations seem quite fair to me. Landlords can actually increase rents on stabilized units substantially provided they maintain and improve the property. Sure, there will continue to be some longtime tenants paying rents that are well below market, but many get what they pay for...older, unrenovated places.
Those who claim the Bronx was destroyed by rent regulation must remember that the same rent regulations were in place on the UES, the UWS, Brooklyn Heights, Park Slope etc. These areas were not torched by their owners.
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