By New York Post (U.S.) | Created at 2024-11-14 00:19:26 | Updated at 2024-11-22 11:44:00
1 week ago
The City Council overwhelmingly approved a bill Wednesday that would largely shift the cost of broker fees to landlords, in a hit to the real estate industry.
The controversial bill — dubbed the Fairness in Apartment Rentals Act (FARE) — passed with a veto-proof majority of 42-8.
New York City is unique in that it is one of the few cities where landlords can hire a broker and pass the broker’s fee on to the tenant.
The law, which takes 180 days to go into effect, will “prohibit brokers from passing their fee onto tenants where the broker is exclusively representing the landlord’s interests.”
“This bill is common sense. It replicates how every other transaction exists in this country,” progressive Brooklyn Councilmember Chi Ossé, who sponsored the bill, said.
The council’s overwhelming support for the legislation came as the average upfront cost of a New York City rental apartment with a broker’s fee reached an all-time high of nearly $13,000, according to a recent analysis from rental website giant StreetEasy.
Ossé and other supporters of the bill, which had 33 sponsors, argued it will help ease the city’s housing crisis.
“New York City has a thriving economy and job market, but the ongoing housing affordability crisis puts that at risk, driving out thousands of residents each year,” StreetEasy General Manager Caroline Burton said in a statement applauding the legislation’s passing.
“This bill would remove an unnecessary barrier to living here and modernize the rental process to bring New York City in line with nearly every other city in the country.”
But opponents — including the Real Estate Board of New York (REBNY), which successfully killed a 2020 effort to ban brokers fees altogether — argued landlords would build the cost of broker fees into rent, resulting in steeper prices for tenants.
Mayor Eric Adams also expressed skepticism about the legislation, suggesting to reporters Tuesday that there was nothing preventing a property owner from passing on the expense to the renter on the lease.
Council Speaker Adrienne Adams, no relation, said she was “surprised” by the mayor’s statements, noting the City Hall had worked with lawmakers on the bill.
“I can’t interpret what the mayor is saying, but the administration was a part of the negotiations on this bill. They raised no major issues, and I haven’t heard from the mayor personally,” she told reporters Wednesday ahead of the vote.
Queens Councilwoman Vickie Paladino — who was one of the eight members to vote against the bill, along with fellow Republicans David Carr, Joseph Borelli, Vickie Paladino, Kristy Marmorato, Joann Ariola, Inna Vernikov and Democrats Susan Zhuang and Kalman Yeger — echoed the mayor’s concerns.
“The law is ridiculous. Once again we’re tinkering with the market, and once again we’ll see the disastrous results,” Paladino said.
“Housing isn’t unaffordable in this city because of greed, it’s unaffordable largely because we’ve regulated it to death. And here we are doing more of what has clearly never worked,” she said. “These fees are going to get built right into rents and the rents are going to increase, it’s that simple.”
