Open Borders Raise The Rent: Third World Economics In The American Metropole
Or, wasting away again in Mamdaniville, searching for my skeptical shaker of salt
Manhattan median rents rose about 7 percent in the first six months of 2026 and median rent has reached a record $5,295 across New York City. Mayor Zohran Mamdani’s rent freeze only applies to about a million units out of the 3.7 million housing units in the metropolitan area. It has the effect of making units more scarce, hence more expensive.
Market-rate apartments are snapped up quickly these days, and quality units demand premiums, so it is a good time for the private landlords. New construction is at record levels, but it is still not fast enough because it is limited by regulation. Thus market rate housing continues to rise in cost during the rent freeze, outpacing inflation.
Overall supply is declining because landlords of ‘stabilized’ apartments do not upgrade units that will never pay back the investment. Mamdani intends to crack down on these “bad landlords” through aggressive code enforcement, organize their tenants, and place distressed properties in more responsible hands through political means.
Put simply, the communists of New York want to seize property from private landlords of rent-controlled apartments and convert it into property controlled by the Democratic Socialists of America via nonprofit entities. The result of this governance already looks like the Third World with American characteristics, and that resemblance will intensify, now.
The future New York City will have many expensive, high-quality properties, but also lots of low-quality housing for the ‘disenfranchised’. In fact, the disenfranchised are to become the enfranchised in this scheme, a reliable voting block that keeps the DSA-Democratic Party in power in the City. By granting these people a newly-minted human right to live free of rent, the DSA will be free of responsibility to the electorate that lives in the housing provided through nonprofit entities.
The phrase ‘housing is a human right’ sounds benign, but it comes with the implication that eviction is a form of violence. The Mamdani administration is “emboldening us so that we no longer tolerate the violence of evictions as a matter of ‘business as usual’”, said one tenant organizer at a recent Mamdani event, as he stood next to her, beaming. Call it Mamdaniville, a city where the biggest single landlord is city hall. And you can’t fight city hall.
Landlords already face a legal and bureaucratic mess with squatters. It takes weeks, often months to evict a tenant that stops paying rent. Squatting has become most common in public housing, and it will become very common in Mamdanivilles, where eviction is violence, while the tenants are organized and radicalized against eviction. The phrase ‘housing justice’ leads to just free housing, at some point, in this formula.
The free housing in Mamdaniville is of course available to undocumented immigrants. Mamdani has pursued strongly pro-sanctuary, anti-cooperation policies toward federal immigration enforcement, particularly ICE, while repeatedly calling for the agency to be abolished. Eviction of the non-citizen from the United States, even the worst sort of criminal, is actual violence: this is the progressive view in the Democratic Party.
Tim Walz, the governor of Minnesota and 2024 vice presidential nominee for the Democratic Party, recently pardoned convicted child sex abuser Tou Lue Vang, a 42-year-old Laotian national, for the express purpose of avoiding his deportation. After Secretary of State Marco Rubio deported Vang anyway, Walz questioned whether it had made Minnesota “any safer”? “Did it improve the idea that we can’t all be judged by our worst day?”
Vang did not simply have a bad day. He was convicted in 2006 of a sustained pattern of conduct from January 2002 through July 2004, at least 4-6 ‘bad days’ over 2.5 years. Vang told police it was a “minor thing” and normal in his culture. If true, then his culture does not belong in the United States. If false, then Vang and Walz are both guilty of dissembling on a horrible crime — Vang to save himself, Walz to save his favored constituent. Minnesota is indeed safer without Vang in it. Minnesota would be safer without Walz in charge.
Minnesota has simultaneously hosted a blue state experiment in housing policy that underlines the risk factors in Mamdaniville economics. St. Paul implemented strict rent stabilization through a popular vote in 2021, capping rent increases at 3 percent. The city had to amend this ordinance in 2025 to ease the pressure on newer buildings most in need of upgrade to remain competitive in the local housing market.
By contrast, Minneapolis, the twin city, stuck to supply-side reforms, including eased development rules. There was no rent control. Housing stock increased by about one-eighth, or 12 percent, from 2017-2022. By contrast, St. Paul saw a 79 percent drop in apartment building permits by 2023. Development “nearly froze” in some segments, and property values fell.
Whereas Minneapolis saw rent grow at a rate below inflation, St. Paul saw greater rent increases. Mamdaniville has more in common with St. Paul than Minneapolis. Like Tim Walz’s Minnesota, Mamdaniville goes out of its way to ensure that housing is a human right for the immigrant without permission to be in the United States. This has the effect of raising rents.
New York City is providing a second natural experiment through the provision of housing that will prove this point. According to “a preliminary draft” of a new Federal Reserve working paper, the Biden administration’s open borders policy approach produced a flood of illegal immigration “unprecedented in modern times” that “acted as a housing demand shock in markets where supply was already constrained.”
Put simply, more undocumented foreigners equaled higher rent. The Biden surge of illegal immigration “can explain approximately 30% of the total increase in house prices and 20% of the total increase in rents … in the average metropolitan area between March 2021 and March 2024.”
“The Impacts of Unauthorized Immigration on U.S. Labor and Housing Markets: New Evidence from Administrative Microdata” is written in the language of economics. Authors Daniel J. Wilson and Xiaoqing Zhou are difficult to pigeonhole politically, for their findings actually dispel canards about immigration at the same time.
Wages did not decline. The authors also found a “negative effect on government transfers”, that is, the use of food stamps and other welfare services by the undocumented, for the simple reason that they lack documentation. This is what makes Third Worldist governance in the form of sanctuary cities and states so odious: the undocumented are often simply given documents, and then services.
In normal times, immigration actually reduces the cost of housing startups, which increases housing stock. However, the Biden years created “demand shock to local housing markets, boosting rents given relatively inelastic short-run housing supply” — in other words, supply did not keep up with the sudden surge in demand.
Higher rents, not lower wages, turns out to be the hidden tax of unrestricted migration into American cities from abroad.
The effect is most pronounced on multi-family units, i.e. apartments. It is most pronounced in the cities that are controlled by the communist cargo cults of our time, that have become very powerful in the blue geographic centers of metropolitan culture production.
They think of themselves as the Elect, these hip young wokesters who dominate these places. They don’t believe in laws of supply and demand. They believe in magical redistributive formulas. As a result, the cities they run tend to increasingly resemble Third World conurbations with a two-tier system of rents.
For the rich, there will always be safe, nice places to live. For everyone else, the government is the landlord of first resort, because the government is the largest single landlord in town. That might not seem bad until the mayor wants you to raise your thermostat in summertime, and life increasingly resembles Havana, or Johannesburg, or Port au Prince.
I am no economist. However, this is an interesting and ongoing historical process that will be measured and reported by economists. Do sanctuary policies raise rents? I do not have an answer, but I am keeping an eye on the question. We have natural experiments taking place in Los Angeles, New York, and Denver, where Mamdanivilles are happening. Watch this space.
Wages Are Low And 'The Rent Is Too Damn High' When Borders Are Not Enforced
Sarah Wakefield, the Green Party candidate for the Makerfield by-election in Greater Manchester, recently told BBC Question Time that it is “absolutely wild” to blame immigration for soaring housing costs.