Several weeks ago, Mayor Bill de Blasio announced that the Predatory Equity Bill has officially become law. Under this new legislation, the city’s Department of Housing Preservation and Development will publish a “Speculation Watch List” which will identify all recently sold, rent-regulated buildings where tenants may be at risk of displacement due to aggressive investors.
The listings will be updated quarterly on the City’s OpenData portal and will be triggered when buildings sell at an unusually high price, indicating that the new landlords plan on significantly raising the rents.
“Protecting New York tenants and affordable housing is a top priority,” the Mayor declared. “This legislation means we will, for the first time, shine a bright light on rampant speculation and greedy landlords who buy residential buildings with the goal of pushing New Yorkers out of their homes. This bill can stop tenant harassment in its tracks.”
As the mayor claims, the Speculation Watch List will alert the city and state agencies of potential tenant harassment while serving as a warning for tenants and tenant organizations. All tagged properties will be closely monitored by these agencies and all tenants in listed buildings will be provided with legal support.
“We need every tool in our arsenal to keep New Yorkers in their homes and safeguard the affordability of our neighborhoods,” said Housing Preservation and Development Commissioner Maria Torres-Springer. “This new Speculation Watch List uses data to capture the signs of potential harassment and distress, and help protect residents from the threat of predatory investment.”
This most recent law is the latest in a string of efforts to protect New York’s tenants from harassment and displacement. It follows closely behind the release of Housing New York 2.0, an initiative established by the mayor to build or preserve 300,000 affordable homes by 2026.
Another similar endeavor was the establishment of the Tenant Support Unit, an agency that goes door-to-door across the city, informing tenants of their legal rights, recording building violations, soliciting complaints linked to harassment and eviction, and providing tenants with referrals to free legal support.
As a NYC landlord, this new bill plays an important role in the way you manage your properties.
This recent law, among others, has made it extremely difficult for landlords to lawfully claim that units are ‘market units.’ It is imperative that every landlord be certain that they can indeed claim this status in order to avoid a potential violation of the law.
Additionally, while you are likely always careful to treat your tenants with utmost respect, from here on, it’s prudent to be extra careful not to take any actions that can possibly be misconstrued as harassment on your part.
It’s equally important to be on guard when considering the purchase of a new building. Always check out the going price of similar buildings in the area before closing on a sale. Is the price unusually high? Is the seller promising that you can easily raise the rents, thus profiting further from the deal? While this may have been a lucrative business proposition in the past, buying a building under these conditions will now be an instant trigger for the Speculation Watch List and will place you under scrutiny of various city and state agencies. Similarly, don’t raise the price on any buildings you are trying to sell or you will run a similar risk.
New law got you stressed? No worries! As always, Jack Jaffa & Associates is here to help you comply with NYC law in every circumstance. We’ll be glad to help you determine how you can conform to the Predatory Equity Bill and ensure that you stay within the confines of the law, at all times.