New York City's current affordable housing crisis means there's keen interest in rent-stabilized apartments, and for good reason. Rent-stabilized apartments often allow people to live in neighborhoods they otherwise couldn't afford. The program also guarantees tenants certain protections that market-rate renters don’t have, including relatively predictable and manageable rent increases, and an automatic lease renewal every year or two, meaning that except in rare circumstances, your landlord can't kick you out. And unlike some other affordable housing in the city, rent-stabilized apartments are not intended solely for low-income New Yorkers.
And with nearly one million rent-stabilized apartments in the city, comprising 44 percent of the rental stock, understanding this complicated program can take some effort. Below, Brick Underground breaks down the essential information you need to know.
But bear in mind that the rules may be changing. Under the newly Democratic-controlled state senate, there has been a renewed push to strengthen tenants’ rights. Progressive politicians and tenant advocates are discussing the idea of universal rent control, and there are nine bills currently in the legislature that would reform the rent stabilization code. Meanwhile, state Assembly Speaker Carl Heastie has suggested taking a more moderate approach.
[Editor's note: This story previously ran in January 2018, and has been updated with new information for 2019.]
Among these nine bills, one would return thousands of deregulated apartments to rent-stabilized status by ending a policy called vacancy decontrol, while others would address a number of legal loopholes that allow apartments to be removed from stabilization.”
“The speaker has announced hearings on housing and has said that he intends to be ‘laser-focused’ on this issue,” says Ellen Davidson, a staff attorney with the Legal Aid Society. “We’re hopeful that at end of this process we will be seeing new laws. Stay tuned, because it’s going to be a pretty housing heavy session with lots going on.”
For now, though, finding a stabilized apartment takes some extra effort but is by no means impossible. So if you want to find a rent-stabilized apartment or merely hang onto one, it's useful to know the ins and outs and how to protect your rights, and not fall prey to misconceptions about the program. We spoke to experts to clear up some of the biggest rent-stabilization myths.
1. You can still find a rent-stabilized apartment, but it takes work
It's not easy to find a rent-stabilized apartment, that's for sure. For one thing, tenants in stabilized apartments tend to hang onto them, and landlords don't always advertise the stabilized status of their rentals. And since the City Council passed a “vacancy decontrol” law in 1994, which allowed landlords to remove apartments from rent stabilization once tenants moved out and the rent exceeded $2,000 a month , the city has lost nearly 300,000 stabilized apartments to deregulation. (A bill in the state senate, if passed, would amend this law, returning to rent stabilization any apartment that rented for $5,000 a month and was deregulated within the last six years.)
But they are still out there if you know where to look. In 2017 there were 966,000 rent-stabilized units and the vacancy rate was 2.06 percent, according to the Department of Housing, Preservation and Development. For more on how to find a rent-stabilized apartment, check out our guide here.
While there are some important exceptions, the rule of thumb is that just about any apartment in a building with six or more apartments constructed before July 1st, 1974 is stabilized. This is different from the even rarer rent control, which applies to buildings built before 1947 where tenants have been living since 1971. For more on how to tell if a building is rent stabilized, click here.
2. Many rent-stabilized apartments have been renovated
It’s true that most stabilized apartments are in older buildings, and landlords have been known to skimp on repairs for renters who aren’t paying market-rate, and even to sabotage their own buildings to force stabilized tenants out. But with the reinstatement of the 421-a tax abatement program after a two-year hiatus, developers can continue building affordable housing in exchange for tax breaks, meaning that some new construction rentals are stabilized, too. (You can see a list of buildings participating in this program here.) Separately, hundreds of buildings across the city are rent-stabilized because their owners received a J-51 property tax abatement, a tax break that landlords get for significantly rehabilitating or converting a building from another use.
In a far-reaching 2009 court decision in which an appeals court found that the landlord of Stuyvesant Town and Peter Cooper Village illegally raised rents and deregulated thousands of apartments after receiving a J-51 tax break, more than 3,000 apartments in these buildings were retroactively stabilized.
Keep in mind, though, that both 421-a and J-51 tax abatements do eventually expire—after anywhere from 10 to 35 years—at which point, so will apartments’ rent-stabilized status. Unless, that is, the landlord hasn’t followed guidelines for alerting tenants about this—read more about the situation here. To find out if a building that receives a tax abatement will eventually lose coverage, check out this information from the Rent Guidelines Board.
Is your rent-stabilized apartment worth hundreds of thousands of dollars—or more—in a buyout? New York City real estate attorney and buyout expert Steven Wagner of Wagner Berkow will analyze your case, tell you how much your landlord is likely to pay, and apply the maximum legal and tactical pressure to get you the biggest offer (often, more than your neighbors). Bonus: He typically works on a contingency fee—meaning you are billed only if and when you receive your buyout. For a complimentary 15 minute telephone consultation with Steven Wagner, click here or call 646-780-7272.
3. An apartment's rent-stabilized status is not always clear
Landlords are supposed to include a rent-stabilization rider in all new leases and renewals informing tenants of their legal rights. However, in practice, landlords sometimes keep tenants in the dark, and don't necessarily tell prospective renters about the status of the apartment when they're on the hunt.
“People sometimes who are new to the city don’t ask if it’s a rent-stabilized apartment,” Tenants and Neighbors director Katie Goldstein says. “Or if they do they get misinformation from either brokers or the landlords about what their protections are in the unit.”
In fact, you may want to avoid asking the landlord altogether, lest they mark you as a problem tenant and rent to someone else, says Sam Himmelstein, a tenants' rights lawyer with Himmelstein, McConnell, Gribben, Donoghue & Joseph (a Brick sponsor).
Luckily, it’s possible to do some sleuthing:
- Your first clue that an apartment is rent-stabilized is if it's in a building that has six or more apartments and was built before 1974. You can find the year a building was constructed searching for the address on StreetEasy or PropertyShark.
- However, not all apartments in these buildings are necessarily rent stabilized. For an apartment to be rent stabilized, it needs to have a rent of less than $2,774.76, as of January 2019. For more details, see this information.
- The city also maintains lists of stabilized buildings in Manhattan, Brooklyn, the Bronx, Queens and Staten Island. You can also look up addresses on the website of the Division of Housing and Community Renewal, as well as the aptly-named site Am I Rent Stabilized.
- You can also check whether an address has received a J-51 or 421-a abatement, which is a sure sign that a building has stabilized apartments.
- And aside from investigating the status of the building, you’ll want to make sure that the rent for the individual apartment is, in fact, the legal rent. To find out, request a rent history from DHCR, which will show you every time the landlord has increased the rent and why. Keep in mind that there are myriad ways an unscrupulous landlord might try to illegally remove an apartment from rent-stabilization, so you might need to do some digging.
4. Rent-stabilized apartments are not always cheaper
Affordable rent is undoubtedly a life-changing benefit for tenants, but rent-stabilized apartments aren’t always cheaper than their market-rate counterparts. Landlords often charge a “preferential” rent that’s lower than what’s technically allowed, because the legal rent would be too steep for the neighborhood. (This is particularly prevalent in less expensive parts of the city, especially in the outer boroughs.) By some estimates, 26 percent of rent-stabilized housing is at a preferential rent, Goldstein says.
A downside of preferential rent is that while it may offer you a relatively affordable rent one year, upon renewal the landlord could potentially hike the rent way up. In stabilized apartments, by contrast, a landlord can only raise the rent in small increments: by 1.5 percent for one-year leases, and 2.5 percent on two-year leases.
And in fact, the cheap rent isn't the only major benefit of the program. A crucial feature of rent-stabilization is the security it gives tenants, since landlords are required to renew leases every year. That means that you can’t get booted from your apartment, even if the landlord sells (except in these cases, when landlords may be able to evict you.) For Lynn, a stay-at-home mom who pays less than $2,000 a month for an East Village one bedroom with her husband and two young kids, the feeling of stability is one of the main advantages, allowing her to plan her budget every year.
“Once you get a rent-stabilized building, you feel like this is for long term,” she says.
5. Apartments are deregulated when rent hits the threshold and there's a vacancy
Let's be clear about this: There are two ways for an apartment to be deregulated: When the rent hits the threshold and there is a vacancy, or the DHCR issues an order of deregulation because the tenant is above the income limits. This occurs when the tenant is still in occupancy, but they lose rent-stabilization protections. The deregulation threshold for vacancy and high rent/high income deregulation is now $2,774.76, and will continue to increase each year in the future by the amount the Rent Guidelines Board sets for one-year renewal leases.
The case of Altman v. 285 West Fourth LLC was anticipated to potentially return thousands of market-rate apartments throughout the city to rent stabilization. However, the decision in May went in favor of tenant Richard Altman's West Fourth Street landlord. Now fewer tenants may be able to challenge their apartments’ deregulated status. For more on how the Altman decision can impact the ability of tenants to challenge their apartments’ deregulated status, check out Himmelstein's analysis here.
6. Rent stabilization is not based on income (with one big exception)
Most affordable housing programs in the city—such as Mitchell-Lama co-ops, 80/20 rentals, and Section 8 vouchers—come with income restrictions for residents. Not so for rent-stabilization (with one big exception, below). Getting a rent-stabilized apartment has almost nothing to do with the amount of money you earn and everything to do with your luck unearthing one of these spots. Although, of course, a landlord will still verify that you make enough to pay the rent.
Here’s the exception: if you're a current tenant making more than $200,000 a year for two years in a row and the legal stabilized rent of your apartment surpasses $2,774.76 a month, the unit will be destabilized. So yes, that stereotype of the wealthy heiress hanging onto an impossibly cheap apartment is also a fiction, and most rent-stabilized tenants earn far below $200,000. In fact, more than a third spend 50 percent or more of their income on rent, Goldstein says.
“It has everything to do with the apartment and nothing to do with the tenant,” says landlord Arik Lifshitz, president of DSA Management, which mostly owns rent-stabilized buildings.
This is because every time a tenant moves out, the landlord can hike the rent by roughly 20 percent—known as a vacancy increase—as well as raise the rent by a fraction of the cost of any upgrades. Even in a single building, you could have one long-time rent-stabilized tenant paying $800 a month, another paying a stabilized rent of $2,000 a month, and another paying market-rate.
“In general, the longer you’ve been in occupancy, the lower your rent is going to be,” Himmelstein says.
7. How and when you can expect your rent to increase
Annual rent increases are set by the Rent Guidelines Board, a city agency that meets every June to vote on hikes for one- and two-year leases. In 2018, the board approved rent hikes of 1.5 percent on one-year renewals and 2.5 percent on two-year renewals.
There are also a few other ways your landlord can raise the rent year-round:
- Improvements to your apartment: If a landlord installs a new appliance or otherwise spiffs up your place, they can pass on 1/40th or 1/60th of the cost (depending on whether the building has fewer than, or more than, 35 units, respectively) to you in the form of higher rent. Keep in mind that a landlord must get your written permission to make these upgrades. (If the apartment is empty, no permission is needed.)
- Capital upgrades to the building: If a landlord undertakes a major building repair, like installing a new boiler, he can also hike the rent, spreading the cost over seven years, and passing it on to the tenants. However, there are currently two bills in the New York State senate that would do away with rent hikes for both individual apartment improvements and major capital improvements.
- Getting rid of a preferential rent: If you’re paying less than the apartment’s legal stabilized rent—say, if the legal rent is higher than the cost of renting in your neighborhood—a landlord can spike the rent to the legal rate the next time the lease is up. “People often don’t know if they’re preferential rent tenants until they get the lease renewal,” Goldstein says. Another Senate bill would make preferential rents last for the duration of a tenant’s lease, thus allowing them to avoid such nasty surprises.
8. Who can you add to the lease? Who can take over the apartment?
The only person you can add to an existing rent-stabilized lease to share in all the benefits and responsibilities of the apartment along with you is a spouse.
“Not a live-in lover, not a partner, not a domestic partner, just a spouse,” Himmelstein says.
However, if you leave the apartment, you can hand it over to a family member who’s been living with you for at least two years (or one year if your family member is 62 or older, or disabled). That person can be a parent, child, grandparent, grandchild, sibling, or a person with whom you have a close financial relationship, such as a partner who shares your bank account.
9. You can be evicted if it is not your primary residence
One of the main reasons landlords kick tenants out is by proving that their apartment is not their primary residence. And “primary residence” doesn’t just mean you get your Con Ed bill at that address—it means that you actually live there for more than six months of the year.
“You could have every piece of paper in the world listing that address as your address, but if you don’t spend more than half your time there, that’s what the judge is going to be concerned about,” Himmelstein says, though there are certain exceptions.
If a landlord suspects you live elsewhere, he can take you to court and get access to your bank statements, credit card records, flight records, and more, all to convince a judge that you don’t actually live in the apartment and evict you.
10. Don't overcharge your roommates
While you can share your apartment with a roommate, you must split the rent evenly—half for two people, in thirds for three people, and so on—even if that person has a bigger room or other perks.
According to the Metropolitan Council on Housing, rent-stabilized tenants must charge roommates by evenly dividing the total rent by the number of tenants. [Editor's Note: A previously published version of this article said that charging your roommate extra would be grounds for eviction. In fact, you'd only get evicted if you were subletting the apartment, i.e. renting it out and not living there at the same time.]
11. Even without a lease renewal you are protected
“People think when the lease expires they can be brought into court and evicted, and that’s just not the case,” Himmelstein says. From 90 to 150 days before your lease expires, your landlord should offer you a renewal or, if there’s a valid reason not to renew (like a plan to move a family member of the owner into your apartment), a notice stating as much.
If you don’t get either, you’re still covered by all the protections of rent stabilization and, in fact, your landlord can’t raise your rent until the lease is renewed (or hike it retroactively), so in some ways it’s a benefit to renters not to get an official lease renewal, Himmelstein says. That said, if you want the document, you can file a complaint to DHCR.
12. You can also get evicted if you break these rules
One of the biggest benefits of living in a rent-stabilized apartment is that it offers more protection from eviction than a market-rate apartment does. Landlords are required to renew your lease every year, so stabilized tenants enjoy a greater sense of security.
That said, there are some instances in which a landlord could evict you. If you’re breaking the terms of your lease—like not using your apartment as a primary residence, for instance, keeping a pet when it’s against the rules, or illegally subletting on Airbnb—you’re making yourself vulnerable to getting the boot. In most cases, though, a housing court judge will give you a chance to “cure” (that is, address the problem) before ruling to evict you.
You could also be evicted if your landlord wants to use your apartment to house family members, though they’ll have to prove this, and must give you at least 90 days notice. You might also have to leave if the landlord plans to demolish the building—but that might not be entirely bad news, as many stabilized tenants have negotiated lucrative buyoutsin such situations. Read more about the rules for evicting rent-stabilized tenants here.