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0 The New York City council passed a bill on Wednesday that will prevent tenants from having to pay fees to brokers hired by landlords.
The move can significantly lower upfront expenses for renters in a city with one of the highest costs of living in the world. The median asking rent in New York City was $3,500 in 2023.
The Fairness in Apartment Rental Expenses Act (Fare) passed with a veto-proof majority in the 51-member city council. The vote on Faretook place on Wednesday and will take effect 180 days after becoming law.
“New York is sending a strong message: forced broker fees are wrong and must be abolished,” said council member Chi Ossé, one of the bill’s sponsors.
When New Yorkers sign a lease for an apartment, fees typically include an application fee, first and sometimes last month’s rent, a security deposit, and a commission paid to the broker for executing the transaction. The average upfront cost to sign a lease is $10,454, according to StreetEasy, the popular real estate listings website.
But now, Fare will make it so that a broker who publishes a listing for a property for rent is to be paid by the landlord. It will also require landlords to disclose the fees that the tenant must pay in their listings and rental agreements. If a landlord fails to comply, they face a penalty of at least $1,000.
The practice of renter-paid broker’s fees in New York has long been criticized. In most other cities, the broker fee is normally paid by the landlord.
Mayor Eric Adams has expressed skepticism about Fare, saying he is concerned it could hurt small property owners.
“We got to get it right, make sure that we reach the goals that we’re looking for, and at the same time don’t hurt small property owners and try to get some relief to some of those who are trying to live in the city,” Adams said on Tuesday during a news conference. “I think the bill has the right intention, but sometimes good intentions do not get the results you’re looking for.”
But property owners are far outnumbered by renters in the bustling metropolitan city. 69% of New York City households rent their homes, according to a report by the office of the city comptroller, Brad Lander.
Lander, who is running against Adams in the 2025 mayoral race, said in June that the move would be a “commonsense element of fairness that the party that chooses the broker should pay the fee. Where tenants hire a broker to help them find an appropriate unit, of course they should foot the bill. But where landlords are the ones to identify and hire, they should pay for the broker they have chosen.”
State assemblyman Zohran Mamdani pushed back on Adams’s message on X.
“No surprise that Mayor Adams is repeating the talking points of his real estate donors,” said Mamdani, who is also running for mayor.
He added that he was grateful to the council member Ossé for getting Fare across the finish line.
