Landlords are now registering tens of thousands more rent-controlled apartments than in years past, and New York State is taking initial steps to enforce a law signed by Governor Kathy Hochul last year that imposes stiff new penalties for failure to register with the state.
The adoption of the law followed reporting by the STADT, which revealed a sharp decline in the number of registered rent-controlled apartments and highlighted cases in which landlords had evicted apartments without government approval and rented them out at market rents.
The state Department of Housing and Community Renewal is warning landlords who miss the July 31 registration deadline that they will face fines of $500 per month per unit. Previously, the one-time fee was $10, but that was rarely enforced.
So far in the 2024 cycle, about 919,500 apartments, most of them in New York City, have been registered with the state by their owners, up from the 750,000 to 800,000 timely registrations in recent years.
Now the DHCR is sending about 11,300 reminders to homeowners who missed the deadline, reminding them of the high costs they will face if they fail to register their rent-controlled apartments.
“Although these registration numbers are preliminary, they far exceed recent historical trends and are a testament to the work of the Office of Rent Administration as well as the governor and legislature in increasing penalties for building owners who do not comply with the regulations,” said Charni Sochet, a DHCR spokesman.
“We expect registrations to continue to increase over time as building owners respond to late payment notices.”
Michael Johnson, a spokesman for the Landlords Association’s Community Housing Improvement Program, said the new figures showed that “99% of rent-controlled property owners promptly complied with the new registration requirements.”
“We are confident that the remaining 1% of cases will be resolved quickly. From feedback from our members, we know that some reminders were sent in error, indicating arrears for units that do not exist. We expect these discrepancies with the DHCR to be resolved,” he added.
The state keeps key records and statistics related to rent regulation top secret, making individual apartment rental histories available only to tenants and landlords. (Here’s the CITY’s guide on how to request your own rental history.) As a workaround, tenant technology project JustFix extracts and compiles information from property tax notices posted online by the New York Department of Financial Services, which list the state-reported number of regulated units in each building.
Using JustFix data, THE CITY examined the decline in the number of rent-regulated apartments in the state following the passage of the Housing Stability and Tenant Protection Act by the state legislature in 2019. This closed almost all of the options previously available to property owners to officially exempt apartments from rent control.
The city released a map and database of apartments that had disappeared from the registers. Tenant organizers told the city they were using these records to track down potential problem areas.
Manhattan Assemblymember Linda Rosenthal (D-Upper West Side) said the city’s data reporting allowed it to grasp the potential scope of the problem for the first time.
She decided her bill, which fixes problems in the 2019 rental law — including the so-called “Frankenstein loophole” that allows combined apartments to evade regulation — was an opportunity to address the problem of lack of registration. “I’ve been consistently lobbying the DHCR on this issue for years,” Rosenthal said. (Manhattan Sen. Brian Kavanagh sponsored the Senate version of the bill.)
She recalled a building on West 74th Street in her district where the owner had converted state-regulated apartments to short-term rentals years ago after failing to register them. And she was frustrated that the state housing authority did nothing to ensure the apartments were returned to the rent-regulated list.
Solving this problem is notoriously difficult, with cumbersome procedures requiring a tenant to file a complaint about a rent overrun and then potentially years of regulatory reviews to determine whether or not an apartment is actually rent-regulated.
If all landlords are required to register their apartments, the owners will be aware that they are being watched.
“If that works,” said Rosenthal, referring to the new penalties she helped draft, “it might solve the problem.”
