NEW YORK – A federal judge has denied a request by the real estate industry to block New York City’s new law requiring landlords — not tenants — to pay broker fees, clearing the way for the ban to take effect on June 11.
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US District Judge Ronnie Abrams ruled Tuesday against the Real Estate Board of New York, the New York State Association of Realtors, and other plaintiffs who sought to halt enforcement of the measure while their lawsuit proceeds. The ruling marks a significant defeat for the real estate industry, which has long opposed the broker-fee ban, arguing it violates constitutional rights and disrupts established market practices.
The law prohibits brokers from charging upfront fees to tenants unless they explicitly hire the broker themselves, aiming to reduce the substantial financial burden often imposed on renters — typically one month’s rent or up to 15% of a year’s rent.
City officials and tenant advocates hailed the decision, emphasizing the consumer protections it offers in a notoriously expensive and competitive rental market. The Department of Consumer and Worker Protection will begin enforcing the law immediately, investigating violations and issuing fines.
While some landlords and brokers warn the ban could lead to higher monthly rents as fees are absorbed into prices, housing experts expect the measure to ease upfront costs for tenants and encourage more mobility in the rental market.
When I was living in Crown heights 18 years ago and I found a building that I wanted to live in. I contacted the management and said to put me on the wait list so when there is a vacancy they can let me know. Anyway they did not let me know and one day I saw a sign in 770 advertising an apartment there. So I called and I said I am supposed to be on your wait list. Why didn’t you call me! In any case, I got the apartment and then they had the nerve to charge me one month rent as a broker’s fee! I said I was the broker. Why should you get a month rent for hanging up a sign when you were supposed to call me and I came to you in the first place! So as far as I am concerned, such a broker fee is highway robbery. Very not nice. Good on the city for breaking it
A few decades ago, landlords of most 6 story buildings in Boro Park/Kensington/Midwood/Kings Highway/Sheepshead Bay were frum guys. If they were smart, they would have played the long term game and promoted frum tenants by combining small apartments into larger ones, by allowing sukahs in courtyards and rooftops,
and by not charging the broker fees from the frum tenants. But the short term myopia took precedence. Now, half the frum people left Brooklyn altogether, and the 6 story buildings are full of various wild third-world tenants, and many Jewish neighborhoods are turning moo-slime. These new tenants are voting in the socialists now. Basically, the landlord’s myopia and selfishness has caught up with them. Feel bad for the landlords, since their investments are losing value, but what else did they expect?
They will find ways to screw tenants over.
The harder it is to be a landlord in NYC, the fewer good landlords there are. In order to survive financially you need to be ruthless.
Beyond my comprhension why anyone would deal with any tenants. Even putting your properties value in a HYSA or an index fund would give the same yield as tenants rents minus the headaches, the lawyers, the mold lawsuits, the slip and falls.
Greedy landlords – if they have bright, conniving kopfs – will find a way to cheat the system.
Less low income housing will be available. Landlords have zero interest in dealing with low income people. They rely on the brokers to vet as much as possible and weed out the worst of the junk. If the brokers don’t get paid, there’s no one to do the vetting. No rentals for the low income tenants. That’s on top of the already low number of availability in apartments.