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.
However, with nearly one million rent-stabilized apartments in the city, comprising 44 percent of the rental stock, understanding this complicated program can be difficult and misconceptions often arise.
[Editor's note: This story originally ran in January 2015, and has been updated with new information for 2018.]
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.
MYTH: It's impossible to find a rent-stabilized apartment now.
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 between 1994 and 2016, the city lost 284,000 units to deregulation.
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.
MYTH: All rent-stabilized apartments are old and dilapidated.
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. 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. However, with both kinds of abatements, the apartments in these buildings can become destabilized when the tax abatements expire. To find out if a building that receives a tax abatement will eventually lose coverage, check out this information from the Rent Guidelines Board.
If you think your landlord is trying to push you out of your rent-stabilized apartment, you’re probably right. “It can be worth a lot of money to your landlord, just as asking for a buyout may be worth a lot of money to you--anywhere from the mid five-figures to more than $1 million,” says New York City real estate attorney Steven Wagner of Wagner Berkow.
Knowing your rights and putting up a good fight with an attorney experienced in buyouts and real estate development can significantly increase your payout: “One of the biggest mistakes you can make is naming a price or responding to an offer without knowing how much your place is worth to your landlord,” says Wagner, who has negotiated hundreds of buyouts for rent-regulated tenants, typically on a contingency fee basis. “A good buyout attorney will analyze the strength of your case, the potential value of your apartment to your landlord, and any taxes you may owe. They'll also structure the buyout in the most advantageous way for you, not your landlord, and help make sure your landlord actually pays.”
To schedule a free 15 minute telephone consultation with buyout expert Steven Wagner, click here or call 646-780-7272.
MYTH: You can always tell from your lease that an apartment is rent-stabilized
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 by putting the address into 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 $2,733.75. 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.
- You can also check whether an address has received a J-51 abatement, which is a sure sign that a building is stabilized.
- 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.
MYTH: Rent-stabilized apartments are cheaper than market-rate apartments.
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.
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. 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.
MYTH: When my rent hits $2,700, my apartment will be destabilized.
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 $2,733.75, 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.
MYTH: My rent is based on my income.
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 $2,733.75 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. More than a third of rent-stabilized tenants 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, 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.
MYTH: My rent will only go up once a year.
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. Currently, landlords are seeking an increase of 4 percent on one-year lease renewals and 7 percent on two-year lease renewals.
In 2017, the board approved rent hikes of 1.25 percent on one-year renewals and 2 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.
- 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.
MYTH: I can add my family members to the lease.
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.
MYTH: I vote and pay taxes with this address, so it's my 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.
MYTH: I can charge my roommate whatever I want.
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. [Ed 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.]
MYTH: My landlord didn't renew my lease, so now I'm getting evicted.
“People think when the lease expires they can be brought into court and evicted, and that’s just not the case,” Himmelstein says. Ninety 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.