Preferential Rent on Regulated Apartments in New York

Perhaps the singularly most venal act of Gov. George Pataki's administration was his signing of the July 2003 Rent Stabilization Law which abrogated the preferential lease. For this alone the tenants should use every ounce of unified political power to defeat this governor.

Either this was done because this governor is paid to willfully destroy regulated tenants by the Real Estate Lobby or this governor is so indifferent and reckless that he failed to understand the impact and consequences of this law.

Tenants who now enjoy a rent stabilized apartment with preferential rent are in for a shocking surprise at the end of their lease term.

Preferential rents are not isolated instances. There are areas and neighborhoods in the City where at the time preferential rents were given it was the only way for the landlord to rent the apartment. So there are pockets of old rentals which may constitute and impact thousands of tenants particularly where the neighborhood has now been gentrified.

I am including the following example to demonstrate what a stabilized tenant under the new law will now confront:

Let us say that when you moved into your apartment in 1990 the regulated rent registered by your landlord was $1,200 but he allowed you to pay a preferential rent of $200.

Since then with the rent guidelines and MCI increases your preferential rent on the last renewal of your lease brought your preferential rent to $600.

Let us further assume that the legal regulated rent on your apartment at the time your lease is up for renewal has now increased to $1,700. Under the new law your rent will be the $1,700 plus the present guideline so that your rent on your renewal lease at a 7.5% guideline for two years will increase to $1,916.75 and any additional approved order for increase by DHCR.