City Council Weighs Reviving Landlord Seizure Powers, Promising Relief for Neglected Tenants

New York’s revived push to seize chronically neglected buildings signals a tougher era for wayward landlords—and renewed debate on the limits of municipal intervention.

When the ceiling in a Washington Heights apartment collapsed onto a child in 2024, few New Yorkers were surprised—but many were incensed. In a city infamous for both sky-high rents and squalid conditions, the spectacle of egregiously negligent landlords is hardly novel. Still, the city’s latest political gambit to curtail such abuses may chart new territory: Mayor Zohran Mamdani and his allies in City Council are again weighing whether to forcibly transfer buildings from persistently bad actors to more accountable hands.

The new legislative thrust reimagines an older, controversy-shrouded policy known as “third-party transfer.” Abandoned five years ago, the scheme once allowed the city to expropriate properties from owners who racked up prodigious tax arrears and code violations, but it drew fierce criticism for disproportionately targeting small, often non-white owners who lost their homes with little recourse or compensation. Councilmember Pierina Sanchez, who chairs the Council’s housing committee, is looking to replace it with a measure she promises will home in only on “the worst of the worst”—chronic offenders whose dereliction has crossed from penny-pinching to endangerment.

Under the proposed Safer Homes Act, any building with unpaid taxes equal to at least a quarter of its value, or 15% if festooned with an average of five or more violations per unit or $1,000 in emergency city repairs, could be subject to seizure. The Department of Housing Preservation and Development would maintain a rolling roster of such “distressed” properties, potentially sanctioning city takeover. Mamdani, fresh from his campaign on a platform to crack down on housing neglect, sees this as the bureaucratic crowbar needed to pry recalcitrant owners from their perches.

To be sure, the proposed powers are circumscribed. The legislation’s authors insist their target is not the humble smallholder behind on tax bills, but, rather, serial offenders whose fecklessness has proved impervious to injunctions and shaming. Daniel Ohebshalom, whose buildings in Washington Heights have inspired both lawsuits and police sirens, is a case in point. After court-ordered repairs went neglected and he was arrested—twice—residents doubt any ordinary tools will suffice.

For New York tenants, especially the estimated 1.2 million living in rent-regulated housing, the prospect of municipal muscle is welcome. Many have seen their halls deteriorate as fines accrue like barnacles on the city’s records. Housing Code Section 27 is routinely flouted; nearly 24,000 buildings currently languish on official “watch lists.” When landlords shrug off $1,000 city-funded repairs, it is tenants who stew through winter without heat—and taxpayers who foot the bill.

Yet for the city’s property market, the measure’s implications provoke more nervous calculations. At the peak of pandemic turmoil in 2021–22, landlords amassed nearly $2 billion in tax arrears and thousands of buildings fell behind on maintenance. Advocates for small owners note that razor-thin margins and bureaucratic delays have pushed even conscientious proprietors into technical noncompliance. The worry is that, absent surgical precision, a revived transfer program could again scoop up struggling but salvageable owners with the truly incorrigible.

Landlord associations are, if not fully embattled, at least watchful. Some industry groups have signaled cautious support, provided reforms contain due process guarantees and protections for equity-rich but cash-poor owners. The Council speaker, whose blessing is required for a vote, remains uncommitted. Meanwhile, the real estate lobby—generally quick to decry regulatory activism—has so far stuck to icy, lawyerly statements.

For Mamdani and his allies, the move signals a more muscular approach to a housing malaise that decades of admonitory fines and tepid reform have failed to redress. The city stands to gain not only safer apartments but reputational ballast: successive administrations have promised to rein in abusive landlords, with little lasting effect. Political calculation is at play. A robust system of managed takeovers might redeem campaign promises and—if implemented equitably—burnish New York’s self-styled credentials as the nation’s most tenant-friendly metropolis.

Rough justice, and refined challenges

New York is hardly alone in deploying municipal seizure as a last resort. Cleveland, Philadelphia, and San Francisco all run variations on the theme, with mixed results. When targeted precisely, such programs can deter fly-by-night operators and restore housing to habitable standards—though at the risk of saddling city budgets with new management headaches. Nationwide, however, the line between necessary intervention and government overreach is famously hard to draw. The legal architecture underpinning property rights in America is robust; history is littered with lawsuits from dispossessed owners convinced they were unfairly targeted.

Internationally, too, cities have toggled between carrot and stick. Berlin has experimented with expropriation, albeit on a much grander scale; the results there have been more symbolic than transformative. The lesson is sanguine yet sobering: shaking the housing tree rarely dislodges only the rotten apples.

We are sceptically optimistic—inequitable housing conditions demand bold action—but caution that policy must be wielded with scalpel rather than sledgehammer. The Safer Homes Act’s strict eligibility criteria are a step in the right direction, redressing the “collateral damage” that tanked the previous attempt. Yet vigilance will be required to ensure that the city’s zeal for rough justice does not metastasise into arbitrary expropriations, chilling legitimate investment.

For New Yorkers, the practical results will matter more than the rhetoric. If the city can both punish genuine scofflaws and avoid ensnaring embattled small owners, it may at last shift the balance toward decency in one of the country’s toughest rental markets. But in the labyrinthine world of New York real estate, policy victories seldom come cheaply.

Only time—and the ever-watchful, ever-litigious property industry—will reveal whether this revived effort yields a fairer deal for tenants and a city less tolerant of derelict stewardship. As the first ceilings are shored up and the first dubious deeds transferred, landlords and their lawyers will be watching for cracks of a different kind. ■