Ram-Man

Zohran Mamdani's rent freeze will make the NYC housing crisis worse

James Moakes decided to corner the market on Ram-Man.

James was working as a tile salesman, and the old He-Man action figures were starting to be seen as collectors items. They started to sell for decent money, so James decided to create an artificial supply squeeze by cornering the global market for Ram Man, He-Man’s square-headed, spring-legged buddy.

NYG running back Cam Skattebo

Moakes searched eBay and antique shops for 15 years, paying anywhere from 20 pence to £800. He eventually accumulated nearly 300 Ram Men.

Unfortunately, Mattel produced up to two million of these Ram-Man figures, so Moakes investment only yielded him 0.015% of the market. You can buy Ram-Man easily on eBay now for $10-25.

It didn’t work, but maybe someone with deeper pockets and lots of free time can pick up where he left off.

The Ram-Man strategy, regardless of outcome, demonstrates the simple and timeless principle of supply and demand. If you are reading this substack you surely understand it.

Unfortunately, our political leaders do not.

NYC mayor and ventriloquist Zohran Mamdani recently proposed a rent freeze in New York that is so economically illiterate and counterproductive, it’s hard to believe it has progressed this far.

The rent guidelines call for 0% increases on one-year and two-year renewals between October 1, 2026, and September 30, 2027. It covers roughly one million rent-stabilized apartments.

It does not cover market-rate apartments or every renter in New York.

Protected tenants in rent stabilized apartments will not receive a rent increase. You might think that rent-stabilization in NYC is limited to the poor, but that is not the case. In fact, Zohran Mamdani himself had been living in a rent-stabilized apartment up until he moved into Gracie Mansion, despite a family fortune squirreled away in international film royalties and a compound in Uganda.

What even an astute Ram-Man collector understands, is that high rents are a symptom of too many renters chasing too few apartments.

So while policy-makers are obsessed with rising asset prices when it comes to stocks and bonds, even at the cost of inflation, if they want lower asset prices when it comes to real estate the obvious answer is to increase supply.

There are a number of incentives you can use to increase supply, and ending rent growth (while costs continue to rise) is not one of them. Taxes, insurance, labor, utilities and repairs are all growing. Putting property managers in peril is no way to improve tenant living conditions. The prospect of vacancies is.

And the prospect of vacancies is the end result of more apartments available for the tenants to choose from.

It is easy and simple-minded to blame landlords for rising cost of living. The fact is, buildings require constant reinvestment. A neglected boiler, roof or hallway is capital being slowly consumed.

The policy also picks winners and losers, and in particular rewards incumbents. Existing tenants win. Newcomers and young families face fewer available apartments and higher market rents.

Growing families looking for more space as they have kids get squeezed yet again, while empty nesters keep three bedrooms because the price is less than a market-rate one bedroom.

A recent study found that rent control in San Francisco protected existing tenants but caused affected landlords to reduce rental supply by 15%. That’s the trade-off: existing tenants who got in on the rent stabilization game benefit, market-rate tenants who get nothing end up with a worse housing market.

A serious city that was serious about tackling the issue of rising housing costs would focus on removing red tape with faster approvals, broader zoning, lower construction costs and property-tax reform.

Developers and landlords should be recognized as the risk-takers working to solve the housing issue. By demonizing them in a cartoonish fashion and instituting such short sighted policies, the problem is sure to get worse.

And maybe that’s the point.