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New York Times
a day ago
- Business
- New York Times
Is a Law on Brokers' Fees Giving Renters a Break?
Good morning. It's Tuesday. Today we'll look at whether a new local law has transformed the market for apartment rentals. We'll also get a look inside the newly renovated Waldorf Astoria hotel in Manhattan. This was supposed to be the summer when a new law on broker fees would change the rental market in New York City. The law, called the FARE Act, all but ended a longstanding practice requiring apartment-hunting renters to pay thousands of dollars to brokers. My colleague Mihir Zaveri says the premise of the FARE Act was simple but transformative: Whoever enlisted a broker's help would pay the broker's fee. If a landlord gave a listing to a broker, the landlord would pay. A broker can show someone an apartment, but it isn't the would-be renter's responsibility to pay the broker — unless they had agreed to a fee arrangement in advance. Some brokers are showing apartments and, afterward, claiming there was a de facto payment agreement. The Fare ACT went into effect on June 11. I asked Mihir to discuss whether the law has made things better or worse for renters so far. You write that the results have been mixed. How so? The intention of the FARE Act was to lower the sometimes staggering upfront cost of moving and make it less confusing and more transparent. In many ways, it has done that. Most renters can avoid broker fees when searching for apartments through online platforms like StreetEasy. Want all of The Times? Subscribe.
New York Times
4 days ago
- Business
- New York Times
Scams and a Rent Spike Follow New York City's New Broker Fee Law
Getting an apartment in New York City was supposed to be easier this summer. Because of a new law, many renters would no longer have to pay thousands of dollars to brokers that landlords had brought in to help. For many people, that has proved true. But a New York Times analysis of 1.3 million listings on the popular rental site StreetEasy also suggests that the shift has come at a cost: Many more landlords than usual raised rents the week the law took effect in June, often by hundreds of dollars a month. Even though higher rents are typical in the busy summer season, the median rent in the city rose in June more than would be expected, according to statistics provided by StreetEasy. The Times's analysis showed a spike in rent increases around June 11, when the law, the FARE Act, took effect with a simple but transformative premise: Whoever enlists a broker's help should pay the broker's fee, which is often thousands of dollars. StreetEasy released a report about a month later saying that the law had not hurt the rental market. The company, which publicly supported the law in the face of fierce opposition from the real estate industry, acknowledged the surge in rent increases when The Times asked about it this week. 'There's no free lunch,' said Kenny Lee, a senior economist at StreetEasy. 'Landlords will always try to offset the additional cost by passing some of it to the renters as a higher base rent. They are not running a charity.' A sharp spike in rent increases The number of apartment listings each week since January 2023 with rent increases of 5 percent or more. Note: Counts include price increases during rental units' active listing windows. Source: New York Times analysis of StreetEasy data By Urvashi Uberoy Want all of The Times? Subscribe.
New York Post
10-07-2025
- Business
- New York Post
NYC renters are scrambling for shelter this summer
Daniela Mora, a stand-up comedian and content creator, found nothing to laugh about when she began her hunt for a one-bedroom rental in Manhattan this year. In order to find a new lease by June 1, Mora's May consisted of scouring StreetEasy at all hours of the night and spending her spare time schlepping across the city to open houses. 'The minute [brokers] text you, you have to fly over to Queens or wherever, trying to be the first person in this unit,' Mora, 26, told The Post. 'It's kind of like a second full-time job.' Under pressure to pursue every possible lead, Mora found herself pushing back professional meetings, canceling workout classes and arriving late to comedy shows. She toured close to 25 apartments, applied to two and got into a bidding war — yes, a bidding war — over one. 6 Mora toured close to 25 apartments, applied to two and was accepted by one. EMMY PARK And Mora's not alone. New Yorkers on the hunt for a new lease this summer are battling more than just heat waves. Historically high rents, low vacancy rates and agonizing bidding wars — a phenomenon typically reserved for home purchases — define this year's red-hot summer rental market. Rent in Manhattan reached an all-time high in June, according to a new report from appraiser Miller Samuel and brokerage Douglas Elliman. The record-setting prices started unseasonably early this year, as far back as February, and have climbed nearly every month since. The median rent for a Manhattan one-bedroom in June was a record-breaking $4,625, and new lease signings well outpaced inventory. What's more, 25% of Manhattan tenants ultimately paid above the landlord's list price, Miller said, a record share of bidding wars for June. Northwestern Queens, home to prime Astoria, nearly matched Manhattan at 24%. Brooklyn outpaced both with a whopping 31.9% of tenants — nearly one in three — facing bidding wars. 6 Would-be buyers sticking around longer in the rental market. Bloomberg via Getty Images New York City's intense summer housing market is nothing new, but this year is special. Skittish would-be homebuyers, wary of stubbornly high mortgage rates and ongoing economic uncertainty, are, in part, a large driver of the current trends, Jonathan Miller, of Miller Samuel, told The Post. 'I would expect more records being set at least in one of the next two months, but probably both,' Miller said. Additionally, the passage of the city's FARE Act in June led to an uncomfortable spike in rents, The Post reported, as landlords responded to the new ban on broker fees by building the cost into rents. 'New Yorkers are unfortunately discovering the negative consequences of the FARE Act in real time,' Brian Hourigan, the managing director of BOND New York, told The Post. 6 The passage of the FARE Act led to a sudden spike in rents and a dip in public inventory. UCG/Universal Images Group via Getty Images Some landlords went so far as to pull their listings from public platforms like StreetEasy in June. The increase in off-market listings depleted inventory and ratcheted up bidding wars in an already tight market. Manhattan rental inventory fell by 12.4% from May to June, according to Miller Samuel. Miller linked the trend to landlords adjusting to the new legislation. Even before the FARE Act took effect, inventory constraints cost renter Abby Paradise thousands. The 24-year-old Paradise and her roommate, desiring an upgrade from their Lower East Side pad, had until the end of May to find a new home. The pair quickly learned that finding an affordable two-bedroom in Manhattan can be a battle, especially in the summertime when newly minted graduates move into town to start their new chapters. 'We could not find anything for the life of us,' Paradise, who works in jewelry sales, told The Post. For weeks, Paradise spent her after hours and weekends going on apartment tours. She estimates she attended at least 30 tours. Plans were canceled and weekend trips were postponed to accommodate the 15 to 20 hours a week Paradise dedicated to the search. 6 Competition for desirable units throughout NYC remains fierce, despite increases in new housing supply. Corbis via Getty Images Even with a budget of $4,600, she and her roommate lost out on two different bidding wars, despite offering up a combined $200 above asking price on both. The pair split to hunt for one-bedrooms instead, but the decision came too late for Paradise. She had to extend her Lower East Side lease and pay a month of two-bedroom rent on her own. The delay cost her an extra $2,000 on top of her typical rent — even though she only stayed half the month. Paradise ultimately found her dream apartment on the Upper East Side — an off-market, rent-stabilized one-bedroom — only after hiring a broker, Olivia Rispoli of BOND, and agreeing to sign for the apartment while it was under a complete renovation. The walls still needed to be painted, and new appliances in the bathroom and the kitchen still needed to be installed. 6 The presence of a cat or a guarantor on an application — both of which Mora had — are sometimes all it takes to get rejected by a landlord. EMMY PARK Paradise's flexibility paid off. 'Honestly, I really didn't expect to have an apartment that I was obsessed with so soon in my early 20s,' Paradise said. 'But it has amazing lighting, an enormous living room and having a dishwasher is awesome.' Mora only found her perfect match in Kips Bay after her newly hired broker, Kunal Khemlani of Corcoran, urged her to bid $100 over the asking rent. She had just lost out on another apartment to a wealthier, pet-less applicant. 6 Mora, with the help of her broker Kunal Khemlani, found her dream apartment just in time. EMMY PARK 'I was very unwell about that,' Mora said. 'But my mindset is that time is money, and I was spending full days looking, researching and applying.' She got the apartment. Luckily, the hard-won lease was a 'love and first sight' situation. 'I literally shook the other agent's hand [when we toured] and said 'I'm gonna live here,'' Mora said.
New York Post
21-06-2025
- Business
- New York Post
Rents jump shocking 15% after NYC ditches broker fees
The city ditched broker fees last week in a supposed win for tenants, but landlords had the last laugh — wasting little time sending rents skyrocketing in an effort to recoup their anticipated losses. Rents shot up a shocking 15% in the week since the controversial FARE Act took effect, with the average rental in the Big Apple jumping from $4,750 to $5,500, according to an analysis by real estate analytics firm UrbanDigs. 6 New Yorkers have been sharing conversations with brokers like this one since the FARE Act was enacted on June 11. Reddit Advertisement 'The Manhattan rental market has seen a sharp reaction,' said John Walkup, UrbanDigs' co-founder. The FARE Act, which prohibits agents representing property owners from charging renters a 'broker fee,' also requires that all fees a tenant owes be included in rental agreements and real estate listings. But the rising rents 'suggests that landlords may be attempting to incorporate broker fees into the rent, which would transfer the cost to renters in a less direct, but very real way,' added Walkup. Advertisement 6 Walkup said the market reacted 'sharply' to the FARE Act. UrbanDigs The law change has created what insiders tell The Post is a 'shadow market' — apartments that aren't listed so landlords can still get tenants to cover the fee. 'We're going to be looking for apartments again like it's 1999 … where you have to know who to call and when to call,' said Jason Haber, co-founder of the American Real Estate Association and a broker at Compass. 'It's going to be an odyssey.' Advertisement 6 Ricciotti said tenants have been asking if they can just pay the broker fee instead of the higher rent, which works out to more money over the long-term. BOND New York Real Estate And listings dried up overnight with an estimated 2,000 vanishing from website StreetEasy on June 11 — the day the FARE Act took effect — while UrbanDigs found available apartments dropped by an eye popping 30%. 6 A renter posted this screenshot of the two different asking prices. Reddit Renters meanwhile have been sharing horror stories online, with receipts — like screenshots of conversations with brokers flat out telling them they get one price if they pay the broker fee and another, much higher rate, if they don't. Advertisement One New Yorker, for instance, was told by an agent the rent was going up $700. 6 Kebenae Tadesse said agents have still been trying to get tenants to pay the fee. Helayne Seidman Another said a landlord was asking $6,800 for a 3-bedroom with a broker fee — or $8,000 with no fee, which is illegal to advertise under the new law. 'We've been inundated with prospective tenants who have asked our agents for the option to pay our brokerage commission, directly and maintain the benefit of the lower pre-Fare Act rental terms, which unfortunately, we have to tell them is now illegal,' said Bruno Ricciotti, principal at Bond New York. 'It's so frustrating,' said Kebenae Tadesse, who had been trying to find a Brooklyn studio. 'Brokers have repeatedly said, 'Well, if I don't charge you this fee, the landlord is just going to put it into your rent,' she told The Post. 'It's discouraging.' 6 Rents went up by 15% on average since the FARE act went into effect. goodmanphoto – Advertisement When Tadesse called out a broker for trying to pass on the fee to her, the agent took down the listing, marking it as 'temporarily off market' on StreetEasy since June 11.
New York Post
20-06-2025
- Business
- New York Post
NYC's new broker fee law already being flouted by sneaky real estate agents, tenants say: ‘Exploiting a loophole'
Well this is just un-FARE. Sneaky New York City landlords have been using tricky tactics to get around a new law that bans them from charging broker fees to renters, The Post has learned. Advertisement Some prospective renters have reported being faced with thousands of dollars in 'management' or 'technology' fees — that look awfully similar to those previously charged by landlords to pay for real estate brokers. 'They're exploiting a loophole in the law,' said Todd Roulich, a tenant broker in New York, of landlords and agents. 6 Some New York renters are still shelling out thousands of dollars in fees for real estate brokers they didn't hire, The Post has learned. Paul Martinka Advertisement Others have reported being told to sign forms stating that they were the ones to hire the broker — even when that wasn't true. The so-called FARE Act — or Fairness in Apartment Rental Expenses — prohibits renters from being charged a 'broker fee' — which is typically about 15% of the annual cost of a unit. But the city Department of Consumer and Worker Protection, the agency responsible for enforcing the FARE Act, told The Post it has received nearly 300 'questions and complaints' about violations of the new law since it went into effect June 11. 6 One Zillow listing demands a security deposit, one months' rent and a 'service/broker fee.' r/NYCapartments/KittyInaPinkHoodie Advertisement 6 'I'm trying to apply for an apartment, and the broker said to apply I need to hire him as my broker to represent the application,' one Reddit user said, 'which of course includes a broker fee.' ZJL Studio – Queens native Kelly McGarry told The Post she met brokers at two different apartment showings this month — both of which used sneaky methods to try to collect a fee. McGarry, 27, reported that each one of the agents she met with tried to get her to sign paperwork saying she hired them, even though she hadn't. 'I've applied for apartments in the past before, and I've never had to verify anything … of that sort,' McGarry said. 'They knew the FARE Act was coming, and they were prepared to do what they could to get around it.' Advertisement One Zillow listing for an apartment in Bayside, Queens blatantly reads: 'For compensation as 'Service/Broker Fee', you as Renter agrees to hire Jack as Broker [sic].' 6 'With the FARE Act going into effect June 11, landlords will be prohibited from passing on the fees of real estate brokers they have retained to prospective tenants,' DCWP said in a statement. Christopher Sadowski Another listing, in Brooklyn's Prospect Lefferts Gardens, even appeared to ask for a security deposit and first months' rent as a mysterious lump sum of $5,040 — followed by $1,800 each additional month. Reports of similar underhanded schemes also abound on Reddit, with one disgruntled tenant writing: 'Some places we reach out [to] … makes us agree to 1 month payment of fees if we sign a lease with them, and they won't show without it.' 'I'm trying to apply for an apartment, and the broker said to apply I need to hire him as my broker to represent the application. which of course includes a broker fee,' another user said. Other agents appear to be even more bold, with one Reddit user posting a StreetEasy listing that outright asked for a $3,500 broker fee – despite the website's own disclaimer that 'under NYC law, you can't be charged a broker fee if you didn't hire a broker.' 6 One Reddit user posted a breakdown of fees they were charged post-FARE Act enactment, including a $3,500 broker fee due at signing. r/NYCapartments/maraxlee 'I'm pretty sure thru FARE we don't have to pay this broker fee,' the user wrote. 'The issue is we desperately need this place lol.' Advertisement The Dept. of Consumer and Worker Protection said when the law went into effect that 'landlords will be prohibited from passing on the fees of real estate brokers they have retained to prospective tenants' under the FARE Act. 'Landlords and their agents will be unable to pass their brokers' fees on to a prospective tenant after the effective date of this law, even if a lease was signed before the effective date,' the agency said in a statement. Some tenants may become even more desperate in the coming months according to The Real Deal, which reported that some landlords are already looking to raise rents to offset costs associated with hiring a broker themselves. 6 A November rally for the FARE Act, with council member Chi Osse speaking. Paul Martinka Advertisement Allia Mohamed, CEO of real estate website Openigloo, deemed that sneaky agents and landlords attempting to ignore and try to work around the law are simply a part of a 'very natural correction period' and that the matter will stabilize when bad actors are disciplined. 'What is really important is for renters to understand their rights when it comes to the FARE Act,' Mohamed said, and 'making sure that they're taking screenshots, saving links, keeping receipts, filing those complaints until we get through this correction period.' City council member Chi Osse, who introduced the legislation last year, urged New Yorkers to report agents and landlords who continue trying to charge a broker fee to tenants. Advertisement 'If you see an online listing that says a broker is working as a prospective tenants' broker, they're lying,' Osse said. 'They posted with landlords' permission, so they're working for the landlord.' To file a complaint regarding a FARE Act violation, consumers can visit or call 311.
