What does this mean for renters in New York City?

It’s one less steep financial barrier to securing housing in a city where rents are soaring and affordable apartments are scarce. It’s worth noting that application fees for apartments were capped at $20 and security deposits at one month’s rent under last year’s new rent laws, too.

What about for brokers and landlords?

Brokers are still allowed to collect their fees, but only from the landlord unless the tenant hired the broker to help find an apartment. Industry experts say that will cause landlords of market-rate apartments to pass on the cost of the broker fees to tenants by raising the rent. Landlords of rent-stabilized units would not be able to raise rents to offset the expense.

Tenants could end up paying more over time if the increase remains baked into the rent down the road. The real estate industry has warned that this change could lead brokers to lose income and, potentially, their jobs.

What happens next?

Yesterday, state regulators said the changes were not retroactive, meaning that renters who paid a broker fee after the passage of the June 2019 rent laws were not entitled to a refund.

Some brokers said they planned to continue business as usual, arguing that they were left out of the process and that the state’s new guidance was not an enforceable mandate.

The real estate lobby, which encouraged its members to follow the new rules, said it could challenge the changes in court.