The New York real estate market is reeling today over a package of impending market reforms. Per the New York Times, the reforms, which strive to change numerous existing rent control and tenant protection laws, would impact upwards of one million rental apartments in New York City and are set to be voted upon later this week; they would include the abolishing of “rules that let building owners deregulate apartments and close loopholes that permit them to raise rents.”
Some industry voices have deemed the impending changes a potential regression to antiquated, ineffective practices.
Impact on landlords and tenants
Perhaps the biggest landlord-related change associated with the legislation revolves around rent payment; should the new laws pass, they would eliminate a provision allowing landlords to raise rent by as much as 20 percent when their units become vacant. In addition to tighter rent regulations — the tightest observed in decades — the legislation could make it harder for landlords to evict non-paying tenants.
Some real estate groups suggest these changes could do “serious damage” to the city’s housing market, reducing key incentives for landlords to renovate and re-build existing apartments. In this sense, the legislation could serve as a double-edged sword; it strives to empower tenants financially but also potentially reduces their chances at receiving necessary structural changes that could subsequently impact their quality of life. For multi-family properties, the latter notion is all the more pronounced.
As of now, Gov. Andrew Cuomo has vowed to sign the first viable bill that crosses his desk. Cuomo has insisted there is no room for negotiation, and he recently advised concerned real estate lobbyists “to speak with their legislators” on the matter. That said, it is likely that the new legislation will soon go into effect unimpeded.