The New York City Council secured a major win for renters by passing legislation to end upfront broker fees, a common burden for those seeking housing across the five boroughs.
Changing the broker-fee landscape in NYC housing
New York City and Boston stand out as the only U.S. cities that require tenants to pay broker fees, even if they have never hired or met the broker. The hefty fee, typically around 15% of the annual rent, is added to the total cost when tenants sign their new lease. This fee goes directly to the broker who listed or showed the property, The City and Gothamist reported.
The bill, which was introduced and sponsored by Chi Ossé, a council member who represents Bedford-Stuyvesant and North Crown Heights in Brooklyn, will now require the party who hired the broker, usually the landlord or building manager, to cover the broker fees. If tenants choose to employ their own real estate agent to ease the housing search, they are still responsible for paying that fee.
🚨LEGISLATIVE UPDATE: It’s official! By a vote of 42-8, the FARE Act passed the @NYCCouncil with a veto-proof supermajority ending forced broker fees. Thank you. pic.twitter.com/PFOenhpNhS
— Council Member Chi Ossé (@CMChiOsse) November 13, 2024
Why has the broker fee ban in NYC been so controversial?
This is not the first time tenant groups and city officials have called to ban broker fees in the housing market. Officials nearly resolved the issue in 2020, but the Real Estate Board of New York, a trade association representing licensed professionals in New York City, sued to block the state-level policy, per Gothamist.
REBNY also pushed back against this most recent legislation, arguing that it would lead to landlords increasing the cost of rent to cover the fees. However, one city council member disagreed with those claims following the 42-8 vote in favor of eliminating rental broker fees for tenants.
“This bill is common sense,” Ossé, said, per Gothamist. “It replicates how every other transaction exists in this country: Whatever you hire or order, you pay for.”
Bro, we won! pic.twitter.com/rkZChvf0NM
— Chi Ossé (@OsseChi) November 13, 2024
Since September I have:
✅ secured a protected bike lane on Bedford Ave
✅ allocated over $5 million to community projects
✅ approved 100s of units of affordable housing
✅ passed a bill to ban forced brokers in NYCIn Q4 I’ve been LOCKED tf in
pic.twitter.com/aDx50jwC4J— Chi Ossé (@OsseChi) November 14, 2024
Other city officials share their views on the broker fee ban
Shaun Abreu, a council member representing Manhattan, highlighted the stark difference between affordable housing and those who cannot afford a place to live.
“This bill is seismic,” he said, according to Gothamist. “It’s going to be the difference between being able to have an apartment or not being able to have an apartment.”
While most council members voted unanimously in favor of the bill, eight Republicans and conservative Democrats opposed the broker fee ban.
“These fees aren’t going anywhere,” Vickie Paladino, a council member representing District 19 of Queens, said, Gothamist reported. “They’re just going to be built into rents, and rents will go up as a result.”
The legislation now awaits Mayor Eric Adams’ signature before becoming law.
The post Are Broker Fees Done For Good In NYC? Here’s What Renters Need To Know appeared first on Blavity.
