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Real Estate Board of New York Challenges Landmark Tenant Protection Law, FARE Act

By George Mcgregor
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Supporters of the FARE Act argue that it promotes fairness in the rental market by ensuring that the party who hires the broker—the landlord—pays the associated fees. They believe this change will make housing more accessible and reduce the upfront costs for renters.
Supporters of the FARE Act argue that it promotes fairness in the rental market by ensuring that the party who hires the broker—the landlord—pays the associated fees. They believe this change will make housing more accessible and reduce the upfront costs for renters. File photo: Ryan DeBerardinis, licensed.

COMMACK, NY – The Real Estate Board of New York (REBNY) is actively challenging the Fairness in Apartment Rental Expenses (FARE) Act, a law that shifts the responsibility of paying broker fees from tenants to landlords in New York City. REBNY has filed a lawsuit seeking to overturn the law, arguing that it violates the First Amendment by discouraging the publication of rental listings and infringes upon the Contract Clause by interfering with private contracts.

In addition to the lawsuit, REBNY has requested a preliminary injunction to prevent the FARE Act from being enforced when it is scheduled to take effect in June 2025. The organization contends that implementing the law would force brokers to incur significant expenses to adapt their business models, potentially causing irreparable harm.

The FARE Act was passed by the New York City Council in November 2024 with a 42-8 vote and became law in December after Mayor Eric Adams declined to sign or veto the measure. The law is set to take effect 180 days from its enactment, aiming to alleviate the financial burden on tenants who have traditionally been required to pay broker fees, which can amount to 10-15% of the annual rent.

Supporters of the FARE Act argue that it promotes fairness in the rental market by ensuring that the party who hires the broker—the landlord—pays the associated fees. They believe this change will make housing more accessible and reduce the upfront costs for renters.

Opponents, including REBNY, warn that the law could lead to unintended consequences, such as landlords increasing rents to offset the additional costs or reducing the use of brokers altogether, potentially decreasing the availability of rental listings. They also express concerns about the law’s impact on small landlords and the real estate market’s overall dynamics.

As the legal battle unfolds, the future of the FARE Act remains uncertain. The outcome will significantly influence the roles and responsibilities of tenants, landlords, and brokers in New York City’s rental market.

George Mcgregor

Mr. McGregor is our staff news reporter who focuses primarily on reviewing and editing (if necessary) all media alerts and press releases for Long Island Guide. Media advisories, alerts and press releases can be sent via this online form and, if approved, will be published free of charge. There is no guarantee your release will be published; inclusion is at the discretion of our editors. We receive hundreds of media advisories and news alerts per day and choose a select few for publication. Please see our editorial guidelines and terms of service.

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