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The New York City Council has passed a bill that would require landlords to pay for the rental brokers they hire. Some brokers believe it will hurt tenants in the long run.
Published Nov. 15, 2024Updated Nov. 16, 2024, 11:50 p.m. ET
In New York City’s highly competitive rental market, perhaps no ritual stokes greater ire for prospective tenants than paying the broker’s fee.
For decades, tenants were expected to pay the fee — a one-time payment that can cost as much as 15 percent of the annual lease amount — regardless of how closely they worked with the broker. New York City is one of only a few cities in the United States where tenants pay for a broker they do not hire themselves.
But that is likely to become a thing of the past: On Wednesday, the New York City Council voted to approve Intro 360, called the Fairness in Apartment Rentals Expenses act. The bill requires whoever hires a broker to pay their fee, meaning a landlord will foot the bill if a broker lists a home on their behalf.
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Landlords and their agents would also be required to disclose all upfront fees in listings and rental agreements, or else risk a penalty, including fines of up to $2,000. The bill passed 42 to 8, which was enough for a veto-proof majority if Mayor Eric Adams attempts to stop it. (In a news conference last month, Mr. Adams expressed concern over how the legislation would affect “small mom and pop property owners.”)
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