REBNY attempts to guide landlords through changes to rent law

New lease template advises on security deposits, late fees and more

New York /
Jul.July 30, 2019 08:00 AM
REBNY releases guidelines to guide landlords through the rent-law changes (Credit: iStock)

REBNY releases guidelines to guide landlords through the rent-law changes (Credit: iStock)

As landlords wait on the state to provide additional guidance on changes to the rent law, the Real Estate Board of New York has issued new guidelines that reflect some of these reforms.

On Monday, REBNY released a new lease template for its members, partially in response to the new rent law, dubbed the Housing Stability and Tenant Protection Act of 2019. The template reflects new limits on security deposits and fees landlords can charge for late rents, as well as new rules surrounding apartment inspections.

Many landlords say the changes to the rent law, considered the most significant in decades, will result in a mass flight from the New York City market and the deterioration of the city’s housing stock as owners cut back or halt renovations altogether.

The template, which REBNY is selling on its website, also includes a new section on the city’s ban on short-term rentals — in light of the proliferation of Airbnb and similar home-sharing sites — and information on mandated bedbug disclosures and smoking policies.

“We were already on the path of trying to revise the leases,” said Carl Hum, REBNY’s general counsel, though he acknowledged that the state’s new rent law “was a major motivation.”

Another landlord group, the Rent Stabilization Association, indicated that it’s also working on a lease template, but is waiting for the state’s Homes and Community Renewal agency to provide an updated lease rider. The rider would reflect the new law’s elimination of vacancy bonuses, which previously allowed for an up to 20 percent rent increase for vacant rent-stabilized apartments. It would also take into account changes to Major Capital Improvements and Individual Apartment Improvements, programs that allow landlords to increase rents through apartment and building renovations.

“The lease rider is effectively the bible,” said Mitchell Posilkin, general counsel for RSA. “That bible needs to be significantly rewritten.”

The state still needs to address a lack of clarity over several aspects of the law, Posilkin said. These include questions about how landlords must revert rents back to pre-MCI levels, since MCIs now expire after 30 years. The new law defers to HCR to spell out “reasonable” costs for certain types of building and apartment renovations.

Posilkin said the fact that the state legislature made the new rent law immediately effective — rather than giving landlords and state regulators time to adapt — represents a “serious disservice to the public, and especially to owners.”

HCR couldn’t provide an exact date for when the rider will be released.

“We are working diligently to craft the new lease rider that clearly delineates the rights and responsibilities of both landlords and tenants,” Brian Butry, a spokesperson for HCR said in the statement. “At the same time, we continue to both enforce the rent laws and investigate those who violate the law to protect tenants and the housing stock.”

Here are some of the key changes reflected in REBNY’s lease template.

Inspections

Under the new rent law, landlords must offer tenants the opportunity to inspect their apartments after they sign the lease but before they move in. Previous leases required tenants to acknowledge that they inspected an apartment before inking the lease and were taking the unit “as is.”

Before:

After:

Security deposits

The law also cut down on upfront rental costs by capping security deposits at one month’s rent. Advocates cheered the change as necessary relief for tenants who are already paying a large chunk of their monthly incomes in rent. But critics have argued that cap could mean landlords are less willing to rent to tenants who are considered riskier, such as those with low credit scores or international students.

Before:

After:

Late fees

Landlords can no longer charge tenants more than $50 for late rent payments, and they can only collect such fees if the tenant doesn’t pay within five days of the first day of each month.


Related Articles

arrow_forward_ios
Matt Lauer exposes Hamptons estate to the market
Matt Lauer exposes Hamptons estate to the market
Matt Lauer exposes Hamptons estate to the market
 Fredrik Eklund and the property (Getty, Steve Frankel)
Fredrik Eklund lists Bel Air mansion for rent as family moves to “forever home”
Fredrik Eklund lists Bel Air mansion for rent as family moves to “forever home”
Gordon Ramsey and his Lucky Cat restaurant (Lucky Cat)
Gordon Ramsay to open first South Florida restaurant in Miami Beach
Gordon Ramsay to open first South Florida restaurant in Miami Beach
Robbie Williams asks $9.2M for his sprawling English estate
Robbie Williams asks $9.2M for his sprawling English estate
Robbie Williams asks $9.2M for his sprawling English estate
Nearly 100K homes sold across UK in August ahead of tax break expiration
Nearly 100K homes sold across UK in August ahead of tax break expiration
Nearly 100K homes sold across UK in August ahead of tax break expiration
One of the many listing photos with dolls for the New Orleans house (NOLA Living Realty)
Creepy dolls helped sell this New Orleans home super fast
Creepy dolls helped sell this New Orleans home super fast
China’s real estate sector rankled investors this week while the Fed signaled it would taper its support of the U.S. mortgage market before the end of the year. (iStock)
Real estate stocks slide as China spooks investors
Real estate stocks slide as China spooks investors
Sculpture artist Robert Hooke’s Sag Harbor home lists for $10M
Sculpture artist Robert Hooke’s Sag Harbor home lists for $10M
Sculpture artist Robert Hooke’s Sag Harbor home lists for $10M
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...