In New York, a typical family budget spends more than half of their income on rent, and each night around 100,000 people sleep in homeless shelters.
In a December report by Manhattan Borough President Mark Levine, it states:
«This is what a full-blown affordability crisis looks like»
– Mark Levine
Living costs in the city also affect groceries, childcare, and other aspects of daily life: 1.4 million people, or 15% of the population, experience food insecurity. According to the U.S. Census Bureau, a family would need to earn about $334,000 a year to afford care for a 2-year-old.
Zoran Mamdani, the future mayor of New York, faces a huge task of making life in one of the world’s most expensive cities a little more affordable.
Mamdani won the largest share of votes among New York City mayors in 60 years, focusing on the problems of the working class. Now he must implement his progressive agenda as the city’s economy slows, the federal government cuts social programs, and the city’s budget gaps grow.
Mamdani promised to freeze rent prices and build more affordable housing, but many nonprofit organizations and subsidized housing developers say they already cannot cover their costs.
He also wants to implement free care for every child from 6 weeks to 5 years old and to abolish fares on city buses.
But funding these plans requires state agreement to raise taxes on the wealthiest segments of the population and corporations. Governor Kathy Hochul has expressed skepticism about his plan to make the entire bus network free and to offset $1 billion in revenue from the MTA fare cancellations.
His ability to implement the program depends on mobilizing supporters in a grassroots campaign to pressure lawmakers on taxes on the wealthy, housing construction, and other priorities, said historian Kim Phillips-Fein, author of Fear City: New York’s Fiscal Crisis and the Rise of Austerity Politics, in the context of the city’s financial collapse of the 1970s.
His allies recently launched a nonprofit organization to pressure city and state lawmakers to pass his plans in city and state legislation in Albany. (Mamdani’s spokesperson did not respond to CNN’s request.)
“People thought Mamdani’s election was impossible a year ago, but it happened thanks to significant political organizing,” said Phillips-Fein. Her conclusion: “his success as mayor will depend on a combination of political will and further organizing.”
«People thought Mamdani’s election was impossible a year ago, but it happened thanks to significant political organizing»
– Kim Phillips-Fein
Before the election, Mamdani’s opponents warned that ultra-wealthy would flee New York and financial collapse would follow his victory. But the rich did not leave the city, and comparisons to the 1970s crisis are “superficial,” Phillips-Fein noted. The city, at that time, maintained a certain level of population and manufacturing jobs, and endured a recession.
The city’s economy remained strong despite concerns about affordability. Employment and labor force participation were at record highs, tax receipts as well, and fears of citywide distress after the pandemic disappeared. Office rents reached 97% of pre-war levels in the first half of 2025.
But there are signs of slower growth.
The city expects that in 2025 78,000 fewer jobs will be created than a year earlier, with most of the employment growth concentrated in the low-paid home care sector, said Sara Parker, senior analyst and strategic officer at the Independent Budget Office of New York.
The projected budget gap in 2027 will be $6.5 billion, which by law must be filled, and even larger gaps are expected in the coming years.
The administration, which is at the helm, called it a “task with a challenging financial picture,” Parker admitted.
Housing is the largest expense for most New Yorkers – it is also one of the factors that helped Mamdani win. He promised to freeze rents for rent-stabilized apartments, calling it a “notable policy.” Such a freeze would affect nearly a million apartments, almost half of the city’s housing stock.
But Mamdani’s plans would face financial pressure on the operating costs of rent-stabilized housing. Since 2020, costs for such apartments have risen by 22%, while rents have risen by about 11%, according to lender Community Preservation Corporation. Increases in utilities, insurance, and labor costs without a corresponding rise in income could lead to a decline in building quality.
Separately, Mamdani plans to build 200,000 new affordable homes for low- and middle-income families that will be continuously subsidized by the government. But this segment of the housing market also faces difficulties: some developers are at risk of loan defaults.
“Trends of rising costs and falling incomes are unsustainable for affordable housing,” said Enterprise Community Partners and National Equity Fund, two organizations that fund affordable housing, in a recent report. They called for urgent funding to stabilize affordable housing and for state action to reduce insurance costs.
«Trends of rising costs and falling incomes are unsustainable for affordable housing»
– Enterprise Community Partners and National Equity Fund
Mamdani assured that his next agenda would be the most ambitious since the Fiorello La Guardia crisis after the November elections. However La Guardia implemented his plan during the Great Depression with the help of Franklin D. Roosevelt and a Democratic Congress to enact New Deal programs – funding for public works, social programs, and other New Deal policies. Instead, Mamdani operates in an era when the federal government is controlled by Republicans who cut funding for key social programs such as Medicare and SNAP, and the president sometimes opposes cities.
State assessments indicate that “One Big Beautiful Bill,” passed by Republicans during the summer, will cause 1.5 million New Yorkers to lose medical insurance; 300,000 households to lose part or all of SNAP benefits; reduce health care expenditures by $13 billion; 200,000 jobs to disappear; and increase energy costs due to the termination of funding for clean energy projects.
Although Donald Trump and Mamdani had a friendly meeting at the White House in November, the administration is withholding $18 billion in federal funding for transit projects in New York.
Tariffs, restrictive immigration policies, and federal cuts create a “tangled climate for cities like New York,” New York City Comptroller Brad Lander noted in a December report. “In the future, New York’s economic trajectory will depend largely on federal policy choices.”
«In the future, New York’s economic trajectory will largely depend on the choice of federal policy»
– Brad Lander
Nevertheless, Mamdani expressed optimism that the city and the federal government can jointly lower New Yorkers’ cost of living as part of his affordability agenda during a November meeting.
“I truly look forward to the opportunity to deliver results for New Yorkers in partnership with the president on this affordability agenda,” Mamdani said.