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New Rent Laws May Be Better For Tenants Than Expected

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When the new rent laws were passed last month, tenant advocates said that they didn't go far enough to protect tenants, but according to the Journal, the actual language of the law may provide more protection than previously thought. Evidently, there are a few paragraphs where the wording isn't crystal clear, and could be interpreted in a way that makes it harder to deregulated rent-stabilized apartments. The deregulation threshold was upped to $2,700 from $2,500, and for a long time, landlords were able to deregulate apartments if the rent for a new tenant exceeded this amount. However the new Rent Act of 2015 seems to say that deregulation can only occur if the previous tenant's rent reached the maximum.

When a tenant vacates a rent-stabilized apartment, landlords can up the rent for the next tenant. This is called a "vacancy increase." According to DHCR, in 2013, the vacancy increase was 18 percent for one-year leases. So if a tenant's rent was $2,450, just below the deregulation threshold, the landlord could increase it to $2,891 for the next tenant. The new rent would be above the threshold, and therefore no longer protected. But under the new law, this may not be the case. From the Journal:

At issue in the 73-page law, which extends regulation for four years, is the meaning of a few instances of the word "was." The previous rent law, adopted in 2011, applied the high-rent threshold to an apartment's "legal regulated rent" at any time.

The text of the new law refers to a legal regulated rent that "was" more than the threshold at any time, suggesting that it may have been looking back to the previous tenant's rent.

Tenant advocates believe this is indeed what the legislature intended because it supports a ruling that was made by an appellate court this past April, but landlord advocates say the interpretation "is basically sort of a reach." Another interesting bit of the law: the deregulation threshold is now indexed to the rent increases set annually by the Rent Guidelines Board, so it will go up accordingly in future years. This means that it will be extremely hard for landlords to evict tenants who make more than $200,000 per year (the income maximum for rent-stabilized apartments) because their rent will likely never catch up to the decontrol maximum.

So basically, it looks like the new laws set us up for all sorts of fun legal battles.
· New York Rent Act Draws Conflicting Interpretations [WSJ]
· New York's Rent Regulations Will Be Extended for 4 Years [Curbed]