Every New York City resident has heard these two words, but few know what they actually mean

As of Monday night, New York City's rent regulation laws have officially expired.

This means that if lawmakers can't agree on a deal in the coming days, landlords of rent-controlled and rent-stabilized apartments will be unstoppable in charging market rate for their units.

But what do the terms "rent-controlled" and "rent-stabilized" mean? And how does an apartment gain one status over another?

Rent Control

First, there was rent control.

Today, rent-controlled apartments make up only 1.2 percent of the city's total, or roughly 26,400 units. But in their heyday in the 1950s, there were more than two million of them. So what happened?

To qualify for rent control, a tenant must have lived in an apartment built before 1947 and have stayed there continuously since 1971. When rent-controlled units inevitably become vacant, they switch to being rent-stabilized.

According to Tom Waters, housing policy analyst for the Community Service Society of New York, that explains why there are so few of them left.

"There's a gradual shift of apartments from rent control to rent stabilization," he said. As people move out or die, the apartments lose their controlled status. So the rules that come with them also change.

Rent Stabilization

As rent-controlled units make the switch, rent-stabilized apartments now make up roughly 47% of the city's 2.2 million rental units.

But these, too, have a history all their own.

In the early 1970s, during a period known as the "Great Inflation," housing prices in New York City were rising uncontrollably. Officials needed a way to slow things down, so they came up with a regulation policy designed to supplement the apartments that were already rent-controlled.

The new guidelines stated any apartment built before 1974 with six units or more could qualify. But not all units in those buildings have necessarily remained stabilized since then.

In 1997, stabilization was restricted to units whose monthly rent was less than $2,000 if the person moved in after 1993. To keep the units in the hands of people who needed them, tenants had to make less than $175,000 a year.

In 2011, stabilization was further restricted to units with monthly rent that's less than $2,500 if the person moved in after June 24, 2011. People who moved in between 1993 and June 23, 2011 fell into this bracket, which also came with a new income threshold of $200,000 a year.

But while one- and two-year leases can only increase by 1% and 2.75% a year, respectively, the idea that tenants in these units are sitting on piles of cash because they pay next to nothing is simply false.

The median rent for a rent-controlled apartment is $1,020 a month paid by someone making $29,000 a year, and for rent-stabilized units it's $1,300 a month paid by someone making just over $40,000.

There's no getting around it: New York City is expensive.