Latest news with #brokerfee
New York Times
19-07-2025
- 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.
CBS News
11-06-2025
- Business
- CBS News
NYC law ending broker fees for renters takes effect today
New York City's new broker fee law takes effect Wednesday, shifting the financial burden of paying brokers from renters to landlords. The Fairness in Apartment Rental Expenses, or FARE, Act was passed by the New York City Council in November and became law in December after Mayor Eric Adams declined to sign the bill. Supporters say the measure will make living in New York more affordable, while real estate groups say the cost will still be passed on to tenants through rent increases. What is a broker fee? A broker fee is a payment made to an agent who helps a prospective tenant find their rental unit. Apartment hunters often pay thousands of dollars in fees before they sign a lease. New York, where 70% of the population rents, was one of the last cities in the country where passing broker fees on to renters was still allowed. Broker fees typically add up to about 12-15% of the annual rent. The fees were not capped under New York law. What is the FARE Act? The FARE Act says the person who hires the broker - which is the landlord in most cases - has to pay them. It bans brokers who represent landlords from charging broker fees to tenants. "What other industry does that exist where someone else orders something, and then someone else has to pay for it?" said City Councilmember Chi Ossé, who sponsored the legislation. On the other side, the Real Estate Board of New York, which represents brokers, previously told CBS News New York that in many cases tenants will see rents go up as a result of the new law. "The landlord is going to have to pay us in some way," broker Janna Raskopf said. "It's just going to be baked into the rent." The Department of Consumer and Worker Protection has proposed fines of up to $2,000 for repeated violations of the law.
