In June 2019, New York passed the NY HTSPA 2019 Act, which involves new regulations and laws surrounding the rental market. While there are many aspects to the act, a portion of the legislation addresses earned real estate commission on rental properties. The new regulations impacted the ability for a landlord’s real estate agent to charge the earned commission to a new tenant (instead of the landlord) if the tenant found the property on their own without the use of an agent.
The real estate community in New York was opposed to this change and felt it was impeding their ability to earn a living. The New York Real Estate Board, the New York Real Estate Association, and dozens of real estate firms immediately filed a lawsuit to overturn this portion of the act. On February 10, the court ruled in favor of the real estate community, and commission charges to the tenant by the landlord’s real estate agent will continue to be allowable for now.
Another court hearing is currently scheduled for March 13 on the matter. Aires will monitor the outcome of this hearing.
The important item to note is that the act did NOT negate or impact the need for a transferee to pay the applicable finder’s fee when utilizing an agent to assist in locating a rental property.
Please reach out to your Aires representative for additional information.