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NYC Landlords Will Now Have To Pay Brokers Fees Thanks To New Law

Claire Leaden Claire Leaden

NYC Landlords Will Now Have To Pay Brokers Fees Thanks To New Law

Renting an apartment in NYC is very expensive for a lot of reasons: the high average rental costs in general, the fact that most of the time you have to go through a real estate agent to find anything, etc. But one substantial cause is the “broker fee” that usually costs at least one month’s rent on top of everything else.

And now, that will no longer be the case! When the Housing Security & Tenant Protection Act and Housing Stability Act of 2019 were passed last year, but there was still some confusion from real estate professionals on what exactly was enacted. So, the New York Department of State just put together this handy FAQ-style guide to further clarify.

And, one of the standout questions was: “can a landlord’s agent collect a ‘broker fee’ from the prospective tenant?” And the clear answer: no!

They clarify that the law says, verbatim: “no landlord, lessor, sub-lessor or grantor may demand any payment, fee, or charge for the processing, review or acceptance of an application, or demand any other payment, fee or charge before or at the beginning of the tenancy, except background checks and credit checks…” If a landlord’s agent tries to collect a fee for “bringing about the meeting of the minds between the landlord and tenant (i.e., the broker fee),” they can be severely disciplined.

Another expensive NYC real estate fee that was also recently cut is the so-called “application fee.” In a September clarification by the DOS of these same laws, it states that a “landlord, lessor, sub-lessor or grantor” cannot collect a rental application fee of over $20.

Renting in NYC just got a whole lot more affordable!

featured image source: Shutterstock