“It’s Up to You New York.” …Will California Ever Learn from Your Mistakes?

As New York’s rental property owners are struggling to survive under the most stringent rent control and tenant protection regime in the U.S. that is made even more challenging given what has been a “difficult at best” economic environment, real estate publication, “The Real Deal” reports “tax lien sales by New York City threaten to worsen the affordable housing crisis” there. So, I ask the question: Can California learn from New York’s mistakes? Unfortunately, I have to say that I sincerely doubt it!

Financial Turmoil in Rent-Stabilized Units

According to The Real Deal, many of New York City’s rent stabilized apartments these days are in financial turmoil. The publication’s May 24, 2025, article reports:

“Pre-1974 rent-stabilized units, mainly in the outer boroughs, now house about 1.7 million New Yorkers, but many of these buildings are in deep financial distress water.”

This concern, as the article points out, is a major threat to the city’s available housing stock:

• Especially affects smaller buildings

• Largely owned by “mom and pop” landlords

Haven’t we been saying this all along here in California that the majority of rental property owners, well over 85% of rental properties (not units) are owned by independent, moms and pops?

Mounting Debts and Property Abandonment

The Real Deal article also points out:

“A good number of landlords have only made ends meet by delaying payments on property taxes and/or water and sewer bills, and city Department of Finance efforts to collect on that debt stands poised to trigger a wave of foreclosures likely to spark a disastrous downward spiral.”

The consequences:

• Deferred building maintenance

• Property abandonment

• Foreclosures

For those of us in California, that’s just a disaster that may be waiting to happen…government foreclosures for property taxes.

Parallels with California’s Burdened Housing Providers

As we are also beginning to see here in California, New York’s rental housing operators have been dogged by:

• Costly climate change initiatives

• Waste diversion mandates

• Eviction moratoriums

The Real Deal goes on to point out:

“This crisis is exacerbated by destructive city and state housing actions — costly climate-change and sanitation mandates, rents never collected after the COVID ‘eviction moratorium.’”

And:

“Units the landlord has to stop renting because the 2019 state Housing Stability and Tenant Protection Act makes it impossible to finance renovations after a long-term tenant finally leaves.”

The result:

• Tens of thousands of vacant units

• No return on investment

• Emergence of a rental Black Market

The Regulatory "Star Trek" Zone

Well, there should be no surprise here New York, New York based upon the way you’ve “squeezed” private property owners...and let this be a warning to you Sacramento...

• Regulatory climate is slowly killing the housing market

• Risk in the rental business has increased dramatically

• We are in a "Star Trek themed" regulatory environment

“Will we ever hit the end of the Universe and see an end to all of the constant and consistent taking of our property rights...?”

Rising Costs, Stagnant Income

As the New York experience has shown—and as we have been trending in California:

• Costs of operating rental properties have increased

• Rental income does not keep pace

• Insurance coverage is harder to obtain

“We are in a bold new, scary world and unless we obtain some relief through regulatory balance, the rental housing dam may surely break.”

A Call for Political Balance and Action

Is there hope? Well, I hope so.

We can make change happen if we:

• Elect politicians sympathetic to rental housing providers

• Aim for a balanced approach—not total elimination of tenant protections

Examples of progress:

• New District Attorney in Los Angeles County

• New leadership in San Francisco including the Mayor and school board

Get Involved — Your Voice and Support Matter

To make real change, you must:

• Get involved in campaigns and community meetings

• Share your story with local representatives

• Support political efforts financially

“I beg, I cajole, and too often come up short when it comes to support for our political activities…”

Case in point:

• A socialist City Council candidate won by an estimated $50,000 gap

• That one seat has cost tens of millions in losses to property owners

Don’t Wait for Someone Else

“There is a belief that someone, perhaps a larger property owner, will do it for you. If there is, and there’s not... they still could not tell your story.”