My advice to all my clients: Don’t analyze problems; analyze solutions.

How does New York City rent control work?

On Behalf of | May 2, 2022 | Landlord/Tenant Matters

Rent control is a well-known term in New York City but there are many misperceptions on how it actually works. It is often confused with rent stabilization.

Rent control

Rent regulation is among the most important landlord-tenant matters. It is comprised of rent control and rent stabilization which are governed by different regulations.

Rent control tenants live in buildings constructed before Feb. 1, 1947. They had to continuously reside in those buildings since before July 1, 1971.

Rent control covers approximately 22,000 apartments.  These are generally occupied by older and lower income tenants who lived in those units since 1971 or by their lawful successors.

A person may continue to reside or succeed to a rent controlled the apartment if they lived with the tenant in that unit for two years before they died or left the apartment. This is reduced to one year if the successor is a senior citizen or has a disability.

Rent stabilization

Rent stabilization covers buildings of at least six units built between Feb. 1, 1947, and Dec. 31, 1973, whose tenants occupied those units beginning prior to July 1, 1971. Rent stabilizations also governs tenants in buildings constructed before Feb. 1, 1947, who moved in after June 30, 1971.

Stabilization also governs buildings with at least three apartments constructed or substantially renovated since Jan. 1, 1974, special tax benefits. These buildings usually fall within stabilization if the tax benefits continue or, sometimes, until the tenant vacates.

Rent increases

The maximum base rent system has governed rent-controlled apartments since 2019. A maximum base rent is set for each apartment and adjusted every two years to cover changes in operating costs.

Owners may raise rents if they certify that they are providing essential services and corrected violations. Increases are based upon the lesser of the average of the five most recent rent guidelines board annual rent increase for one-year renewal leases or 7.5 percent each year until the MBR is reached.

Tenants may contest proposed rent increases by claiming that the building has violations or the owner’s costs do not justify an increase. Rent control tenants do not have to pay rent increased by fuel pass along costs.

A rent-controlled apartment is decontrolled after its tenant leaves. The apartment becomes rent stabilized when it is in a building built before Jan. 1, 1974, and contains at least six apartments. Its owner must register the unit with the City’s Division of Housing and Community Renewal. Owners may charge the first stabilized tenant an agreed-upon rent which may be appealed by the tenant.

Attorneys can assist you with dealing with landlord-tenant issues. They can also help resolve disputes.