On November 13, 2024, the New York City Council passed the FARE Act, with 42 out of 51 council members voting “Yes.” The bill is now with Mayor Eric Adams for his review and approval (or veto) within 30 days, and will not go into effect until 180 days after it becomes law.
The passage of the FARE Act is a relief for NYC renters, who pay an average of $12,951 in upfront costs — including broker fees — to move into a rental, according to StreetEasy data. StreetEasy® and Zillow® believe this legislation will result in positive changes for all sides of the market, and will make the renting process in NYC more fair, affordable, and transparent.
If you’re a renter wondering how this affects you, please note that the changes have not yet taken effect. Meanwhile, as the FARE Act moves through the legislative process, we’re here to explain what it is, when it will go into effect, how it will impact NYC renters, and why we believe it’s good for everyone involved.
We will continue to update this article as more information becomes available, and a clearer timeline emerges for when the changes will go into effect.
What is the FARE Act?
The Fairness in Apartment Rental Expenses (FARE) Act makes broker fees the responsibility of the party who hires the broker — which, in most cases, is the landlord. It requires landlords or their brokers to disclose and advertise any fees a tenant must pay on their rental listings and in rental agreements, or else risk a penalty, including fines and risk of lawsuit. It also gives renters the choice of hiring a broker to represent them, and ensures tenants aren’t forced to pay a broker fee as a condition of signing a lease agreement.
When will the FARE Act go into effect?
We will update this section as soon as a more exact timeline is known.
At this time, the FARE Act has been passed by the City Council, but has not yet been enacted into law.
If enacted into law — whether through Mayor Adams’ signature, the City Council overriding a veto, or Adams allowing the bill to become law without his signature — the changes will go into effect 180 days (about 6 months) later. Under any of these scenarios, we’re likely looking at a summer 2025 date for the FARE Act to take effect. Until then, NYC’s current broker fee system remains unchanged, meaning you can still be required to pay a broker fee to a broker hired by the landlord.
How will the changes impact NYC renters?
Once the FARE Act goes into effect, a broker can no longer require you to pay them a fee if they’ve listed an apartment on behalf of a landlord. You can still hire your own broker to represent you and help you find a rental, in which case you’d pay them a broker fee for the services you hired them to do. But the FARE Act ensures NYC renters only pay a broker fee when they explicitly hire the broker to represent them. Any fees you, as a renter, are asked to pay must also be clearly disclosed upfront, including in the listing on StreetEasy. And remember, broker fees are always negotiable.
We believe these changes are good for NYC renters and will improve fairness, affordability, and transparency in the renting process. The FARE Act will significantly lower your upfront costs when signing a lease, and ensure you clearly understand any fees you’ll be asked to pay — with no surprises later on.
Why StreetEasy believes these changes are good for everyone
Lowering the financial barrier to securing an apartment will lead to a healthier market for renters, brokers, and landlords alike. Currently, many NYC renters would like to move within the city, but due to the high upfront costs required, are unable or unwilling to do so. If the FARE Act becomes law, tenants will be able to move more frequently, improving the availability of rentals and creating more transactions for brokers to support. Increasing renter mobility unlocks inventory for all industry participants.
This legislation is a step in the right direction to improve the overall housing market in NYC. By lowering the upfront costs of moving, we can open doors for tens of thousands of renters who are unable to move, while ensuring agents are paid fairly for their valuable work.