Build Homes, Don’t Seize Them, Mayor Mamdani

“Block by Block,” Zohran Mamdani’s “sweeping blueprint” to reduce housing prices in New York City, comes with a dangerous promise. “When necessary,” the mayor said on May 26, “we will take aggressive legal action to remove negligent owners and property managers” and transfer ownership to “responsible stewards.” The problem: The proposal is an unconstitutional power grab that would exacerbate the city’s housing crisis.

The Fifth Amendment’s takings clause stipulates that the government may not take “private property” for public use without “just compensation.” There is a long-standing debate over the extent to which regulations that constrain the use of property but don’t seize it outright qualify as takings. Virtually all jurists and legal scholars, however, agree that outright confiscation does.

Very limited uncompensated seizures of apartment buildings might be justified under the so-called police-power exception to takings liability, which permits the government to restrict uses that pose a serious threat to public health or safety. New York 7A program allows the city to take over the administration of dangerously unsafe rental properties. Yet that applies only to extreme cases — fewer than 30 properties as of fiscal 2024 — and generally doesn’t result in permanent confiscation. The mayor’s proposal is far more expansive.

If the government could expropriate property at will, it could pursue widespread seizure from anyone using property in ways the party in power disapproves of, or for purposes of transferring it to cronies and favored constituencies. Such abuses are common in authoritarian states, which is one reason the foudners inserted the clause into the Bill of Rights in 1791. James Madison and others supported it in part because of arbitrary confiscation by British authorities.

The mayor’s proposal doesn’t just violate the federal and state constitutions, which have nearly identical restrictions on takings. It would also make the city’s shortages worse. Faced with the prospect of potential expropriation, many owners would likely withdraw properties from the market or not list them in the first place. New York’s rent-stabilization laws have already induced owners to abandon thousands of apartments that can’t be profitably maintained or upgraded. The mayor seeks to make city policy more severe by “freezing” rents for hundreds of thousands of units, preventing even the modest increases permitted under current law.

As Jason Furman, formerman of President Barack Obama’s Council of Economic Advisers, told this paper in 2024: “Rent control has been about as disgraced as any economic policy in the tool kit.” That year a meta-analysis of studies in the Journal of Housing Economics found that rent control greatly reduces the quantity and quality of available housing by deterring owners from building units and putting them on the market.

The mayor often decries the city’s “systemic inequities” that have made living there more onerous. A great opportunity to make good on that rhetoric would be to target the real barriers to access: the exclusionary zoning rules that severely limit the amount and types of housing that can be built on most of the city’s residential land. Economists and land-use scholars across the political spectrum recognize that these restrictions are the main constraints on supply. Progressive legal scholar Joshua Braver and I have argued that such restrictions also violate the takings clause The right to property enshrined in the Fifth Amendment includes the right to use property, which severe limitations on construction abridge.

Mamdani has rightly praised cities like Austin, Minneapolis and Auckland, New Zealand, which have seen the virtue in empowering private owners to build new housing. Such YIMBY — or “yes in my backyard” — zoning deregulation reliably increases supply and reduces prices. The “Block by Block” plan includes a few steps in this direction, such as aiming to make it easier to build new near public transit. But the effect of such measures would be muted by expropriation and expanded rent control. The bulk of the plan involves increasing City Hall’s power, despite government-owned housing’s terrible record everywhere it has been tried.

The political right has its own snake-oil housing policies. Tariffs and mass deportation of immigrants make housing more expensive by increasing the price of building materials and the costs of construction, respectively. Some on both the right and left also advocate barring institutional investors from owning rental properties, even though that, too, is likely to reduce the availability of housing options.

But counterproductive right-wing policies don’t justify Mamdani’s. To alleviate the “deepening housing crisis,” stop digging a hole with more government control of the kind that caused it in the first place. The better course is to respect constitutional property rights and let landowners build housing as they wish.