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New York renters can say goodbye to broker fees

Posted: 8:09 PM, Feb 05, 2020
Updated: 2020-02-06 17:29:56-05

NEW YORK — Broker fees are now a thing of the past for New York renters.

They were effectively eliminated late Tuesday, as was reported in The Real Deal. The change is part of laws passed in 2019 designed to protect tenants.

"The Department of State recognizes that the Statewide Security and Tenant Protection Acts of 2019 has already had a significant and sweeping impact on housing markets throughout the state," a spokesperson for New York's State Department said. "The updated guidance continues to interpret the laws according to their plain meaning and consistent with the way they were intended to be applied -- which is to provide the strongest possible set of protections to tenants."

Brokers can still collect fees from landlords.

State Sen. Julia Salazar applauded the news.

"We should eliminate barriers that currently prevent low-income people from acquiring stable housing," she tweeted. "Broker’s fees are a barrier for tenants and families who need to move. It should be the property owner’s responsibility to pay a broker who finds them tenants."

The Real Estate Board of New York has promised to fight the change.

"We are aggressively pushing back on the Department of State's misguided interpretation that will have a devastating impact on hard-working real estate agents, owners, and renters throughout New York State," REBNY Senior Vice President for Government Affairs Reggie Thomas said. "If enforced, this guidance would result in higher prices for New Yorkers as building owners include commissions into rents and dramatically cut the incomes of tens of thousands of agents who provide a valued service in helping people find their new homes.”

Anyone seeking to file a complaint over broker fees can access a form here.

Part of state's guideline on fee's is below:

NY RPL § 238-a(1)(a) provides, in part, “no landlord, lessor, sub-lessor or grantor may demand any payment, fee, or charge for the processing, review or acceptance of an application, or demand any other payment, fee or charge before or at the beginning of the tenancy, except background checks and credit checks…”