What is the difference between rent control and rent stabilization?  

December 15, 2014

Many New Yorkers have heard about apartments with a rent stabilized or less common a rent control. In New York City, Rent Control tenants are generally in buildings built before February 1, 1947, where the tenant is in continuous occupancy prior to July 1, 1971. Tenants who took occupancy after June 30, 1971, in buildings of six or more units built before January 1, 1974, are generally in a rent stabilized apartment. If a tenant is renting an apartment in a building that is a co-op, is he or she rent regulated?

In New York City, a rent regulated tenant in occupancy before the conversion to cooperative ownership under a non-eviction plan remains regulated as long as he or she continues in occupancy as a non-purchasing tenant.

How do I know if my apartment is Rent Regulated?

In NYC, a Rent Regulated apartment may be Rent Controlled or Rent Stabilized. Generally, an apartment occupied by a tenant continuously prior to July 1, 1971 in a building built before February 1, 1947 would come under Rent Control.

A Rent Stabilized apartment would generally be located in a building constructed prior to January 1, 1974 having 6 or more housing units.

How does rent control work?

Rent control limits the rent an owner may charge for an apartment and restricts the right of any owner to evict tenants.

Rents charged in controlled apartments are set and adjusted on the basis of registrations filed by owners when Federal rent control was imposed in 1943. The rent control law allows DHCR to determine how much rents can be increased based on an assessment of what it costs owners to operate their buildings plus a reasonable profit.

In New York City, rent control operates under the Maximum Base Rent (MBR) system. A maximum base rent is established for each apartment and adjusted every two years to reflect changes in operating costs. Owners who certify that they are providing essential services and have removed violations, are entitled to raise rents up to 7.5 percent each year until they reach the MBR. Tenants may challenge the proposed increase on the grounds that the building has violations or that the owner's expenses do not warrant an increase.

For New York City rent controlled apartments, rents can also be increased because of increases in fuel costs (pass-along’s) and in some cases, to cover higher labor costs.

How does rent stabilization work?

Like rent control, rent stabilization also provides other protections to tenants besides limitations on the amount of rent. Tenants are entitled to receive required services, to have their leases renewed, and may not be evicted except on grounds allowed by law. Leases may be renewed for a term of one or two years, at the tenant's choice.

If a tenant's rights are violated, DHCR can reduce rents and levy civil penalties against the owner. Rents may be reduced if services are not maintained. In cases of overcharge, DHCR may assess penalties of interest or treble damages payable to the tenant.

Rent increases

The Rent Guidelines Boards set maximum allowable rates for rent increases in stabilized apartments. These guideline rates are set once a year and are effective for leases beginning on or after October 1st of each year. Pursuant to the Rent Regulation Reform Act of 1997, owners who sign vacancy leases are entitled to collect vacancy increases provided in the Act.

Both in New York City and the ETPA counties, rents can be increased during the lease period in any one of three ways, so long as the lease provides for the collection of an increase during the lease term: (1) with the written consent of the tenant in occupancy, if the owner increases services or equipment, or makes improvements to an apartment; (2) with DHCR approval, if the owner installs a building-wide major capital improvement; or (3) in cases of hardship with DHCR approval.

Are there any requirements for gaining access to registered rental information?

Yes, proof of identity and/or authorization for Rent Registration needs to be given to the Division of Housing and Community Renewal when access to registered rental information is requested.

Is the owner of rent-stabilized apartments required to register the rents?

Yes, the owner must register rents of rent-stabilized units with DHCR on an annual basis.