Starting today, the Fairness in Apartment Rental Expenses (FARE) Act, which prohibits landlords from passing on broker fees to tenants, is set to save renters thousands of dollars in upfront costs.
That's evidenced in a report from StreetEasy, which estimates upfront fees cost an average of $12,942. But with the elimination of the broker charge, that's expected to come down by 41.8 percent to $7,537, a more than $5,400 difference, the real estate marketplace projects.
Some have argued that landlords will pass on the costs to tenants, resulting in a major increase in rents. Part of that might be true — but it may not be that significant. StreetEasy found that properties that switched ahead of the FARE Act's effective date only hiked rents by 5.3 percent, which is only 0.7 percent higher than the pace of the rest of the rental market.
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From January to April of 2025, the majority of property owners were using real estate agents. With the number at 56.9 percent — it remains to be seen if and how much that number will drop now that broker fees can't be passed on to tenants.
While StreetEasy noted that the new law will make NYC more affordable for residents, the marketplace is teaming up with Zillow to advocate for more policies to improve the landscape even further. This includes pushing for security deposits to be paid in installments, improvement of positive rental reporting to credit bureaus, assistance programs for closing costs and down payments for housing and increasing the overall transparency of fees.
"Disclosing all fees upfront will help renters quickly understand what they can and can’t afford, making it easier for agents and property managers to connect with qualified prospective tenants," SteetEasy wrote.
"Ultimately, the FARE Act will help all New Yorkers see a more transparent, affordable, and efficient rental market."
Also, SteetEasy lists the supply shortage in the city as a major obstacle. The City of Yes for Housing Opportunity, which loosens restrictions on zoning, helps address it — but the company is calling for more action. This includes laws that authorize accessory dwelling units and real estate conversion projects. Plus, providing tax incentives to spur development could help, too, according to StreetEasy.
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Anthony Russo
Anthony Russo has been contributing to GlobeSt. since July 2024. Along with CRE, his financial background expands to capital markets, the economy, and consumer issues. Previously, he has written for CapitalWatch and was a senior reporter for The US Sun.
