The word "tenement" has had different meanings at different times. Today we use it to refer to housing built specifically for multiple, working-class families from the mid-nineteenth century until the Multiple Dwelling Law of 1929.
According to some sources, the first tenement was built in 1833. Located on Water Street in lower Manhattan, the building was a novelty at a time when the city's standard housing stock was largely designed for individuals and single families. Moreover, Manhattan's landlords preferred constructing pricier buildings in hopes of boosting their property values.
However, the influx of immigrants into New York City beginning in the 1840s forever altered the city's real estate market. The city's paucity of affordable, multiple-family homes forced these newcomers into ill-fitting row homes and single-family houses. Savvy landlords and nascent businessmen, many of whom came from working-class, immigrant families, sensed this emerging market for cheap housing.
Indeed, the prospect of collecting rent from scores of families packed into small, cheaply appointed spaces was a sound and sometimes lucrative investment. Most tenements earned landlords about a 20 percent return on their investments.
For tenants, these buildings were also the most affordable housing in New York; they offered lower class citizens their first chance to make a home in the city. It was no surprise, then, that by 1864, more than 62 percent of New York's 800,000 residents lived in tenements.
Still, New York's dearth of housing laws (until 1867, there were no federal, state, city laws requiring developers to provide tenants with basic amenities) meant that early tenements represented some of the worst housing ever built in the United States.