Rent Reforms Could Be Coming To NYC: Here's What They Mean

NEW YORK CITY HALL — Major reforms to New York's rent regulations are on a laundry list of legislation Democratic lawmakers want to pass now that they control the entire state Legislature. With energized tenant-rights advocates behind them at a Monday rally outside City Hall, officials pledged to finally push through a slate of proposals that they argue will protect New Yorkers from displacement.

"We are going to roll up our sleeves and we are going to get it done so that by the time session ends in June, we’re going to come out here to celebrate laws that actually protect tenants and not landlords," said state Sen. Michael Gianaris of Queens, who's set to become the No. 2 Democrat in his chamber come January.

The primary proposals would make it harder for landlords to hike prices in rent-stabilized apartments based on turnover or physical improvements in the building. Advocates also want to expand rent protections and extend them to tenants across the state.

Loopholes in the existing law give landlords incentive to push out tenants and reap higher rents, advocates and lawmakers say. Assemblywoman Carmen De La Rosa (D-Manhattan) said they're part of a "toolkit to displacement."

Landlords see things differently. The current rent laws encouraged construction of rental housing in a city once starved of it while ensuring owners could have enough money to maintain their rental buildings — progress the proposed changes would roll back, wrote John Banks, the president of the Real Estate Board of New York, in a column earlier this year.

But advocates frustrated with the city's continuing homelessness and affordable housing crises argue it's time for a change now that the real estate industry has lost its grip on the Legislature.

"Landlords have had their run of Albany for decades," Assemblywoman Linda Rosenthal (D-Manhattan) said. "They can stay home in their expensive apartments here in the city while we take care of business in Albany."

Here's a look at the major rent reform proposals Democratic lawmakers want to push through and what they could mean for New York City tenants.

Ending Vacancy-Based Rent Hikes

One big change would be an end to vacancy decontrol and the vacancy bonus, two provisions that advocates say incentivize tenant harassment and displacement.

Landlords of rent-stabilized apartments are allowed to increase rents as much as 20 percent whenever a tenant leaves and a new one moves in. That's a much steeper hike than the 1.5 percent increase the city's Rent Guidelines Board approved for one-year leases this year.

Once the rent in one of those units hits a certain threshold — currently $2,733 a month — and a new tenant moves in, the apartment can become deregulated under a provision known as vacancy decontrol. That allows landlords to hike the rent to market rate.

Those stipulations give landlords an incentive to harass and push out longtime tenants so they can make more money off of new ones, advocates and lawmakers say. The heavily Democratic state Assembly passed bills this year to repeal them but they did not get through the Republican controlled Senate.

"Many provisions of our law make the apartments more valuable if they’re vacant than if they’re occupied," said state Sen. Brian Kavanagh (D-Manhattan)

But REBNY argues the vacancy bonus and decontrol provisions have helped better the city's housing stock.

"There’s no disputing that the vacancy decontrol and vacancy allowance provisions and other aspects of the rent regulation law which encouraged capital investment have improved and transformed the quality of our rental housing, and with it, New York City," Banks wrote.

Major Capital Improvements

Landlords can ask to hike prices in rent-stabilized apartments after making fixes that benefit all tenants, such as work on boilers, windows or roofs. These are known as major capital improvements.

When approved, those rent increases are made permanent, meaning tenants bear the cost of the repairs for years to come. The hikes are sometimes imposed for long-neglected fixes, and landlords "often overstate the cost and extent of renovations," according to the Upstate Downstate Housing Alliance, a coalition of rent reform advocates.

Several Democratic lawmakers named eliminating rent hikes for major capital improvements as a legislative priority. The increases are "de-stabilizing rent-stabilized housing," said Sen.-elect Julia Salazar (D-Brooklyn).

Reforming Preferential Rents

Sometimes landlords agree to charge a preferential rent, which is lower than the maximum they can legally make tenants pay. The Upstate Downstate Housing Alliance says about 266,000 families in New York City pay such prices, which must be stated in tenants' leases along with the legal maximum rent.

Under current law, landlords can choose to end the agreement and charge the maximum when the tenant renews their lease or leaves. That means New Yorkers paying preferential rents could see big rent hikes from one year to the next.

"I am tired of being scared every time my lease is up for renewal, and there are too many people in that same boat with me," said Sen.-elect Jessica Ramos (D-Queens), who pays preferential rent herself.

Advocates want preferential rents to last as long as the tenant lives in the apartment. A bill to bar landlords from hiking preferential rents upon renewal of a lease passed the Assembly this year but did not get through the Senate.

(Lead image: Assemblywoman Carmen De La Rosa speaks at a rally outside City Hall on Monday. Photo by Noah Manskar/Patch)