Rebny vs. Consumers

I think it is important to understand why, historically, rental fees in New York City were paid by tenants. It had an awful lot to do with Rent Stabilization: when building owners were being forced to lease units at below market it made absolute sense that tenants pay fees for finding them below market units, and incoming tenants were reasonably content to pay a few thousand dollars commission when they were saving at least that amount on rent in the first year or to. On the flip side, most new construction units were OPs (Owner Pays) because they were at full market.

Also, owners of Rent Stabilized buildings couldn't send anyone who came directly to the building to any broker who charged the tenant a fee (on more than one occasion I spoke with friends of friends who were recounting their saga of apartment hunting in NYC and when they got to the point where they went directly to the building first I asked if they were charged s broker's fee, they said "yes," I told them where in Dept of State to call and lodge a complaint, and they got their money back). Now we don't have many below market RS apartments being newly leased, so it isn't as readily apparent that fees should be borne by tenants. I don't know when DOS changed the rule about direct tenants not paying fees, but I would be in favor of it being reinstated.

That said, since money is fungible I don't really see how tenants paying fees or landlords paying fees makes all that much difference except in the case where tenants are extremely cash poor and have enough $ for first months rent and security but just don't have the cash for brokers fee. Personally I don't see that as a large segment of the market. Tenants will have that much more cash and be that much more able to pay slightly higher rents, so they will. And the landlords will certainly want to charge more for units to absorb the cost and as I just said I think tenants will go along. So I'm not sure that this is a huge win for tenants just someone wanting to "do something" that doesn't really solve the problem.

NB I'm the same guy who has repeatedly stated that REBNY screwed up in 2019 and even though it was reasonably obvious that the State Legislators were going to change portions of the RS statute due to decades of landlord abuses after the 1993 changes allowing many RS units to be taken out of RS. But REBNY decided to take a "my way or the highway" stance and lobbied for zero changes rather than trying to negotiate something better. And that it blew up in their faces, so I really blame the people who were against any changes for any harm they may be experiencing, because they had their chance and they decided they still had enough legislators in their pockets like they've had for the past 30 years. And even though certain of the abuses were well documented and not by some fringe elements elements but by major players they refused to even negotiate closing some loopholes.

I've also criticized how REBNY treats small firms/independants vs large firms, their arcane rules structure, and the host of other things. So I'm not talking about whether they shouldn't be trying to quash consumer friendly bills, just giving a history lesson and point out that this bill may not be as big a boon to consumers as it is being portrayed.

money being fungible between parties in complex transactions assumes levels of efficiency that are less present in markets with supply/demand imbalances, power imbalances (landlord vs. tenant, broker vs. desperate renter), information asymmetry, and outdated regulation.

To me the biggest problem with the slate of recent pro-tenant bills was the one limiting security deposits. There are two broad categories of tenants -- people with dogs and people coming from overseas who didn't have established American credit -- who used to use "extra" security as a way of quashing landlord concerns, and now those people can't get apartments. A friend just sent me a friend who has two dogs, and is looking to rent an apartment, and I'm like, I can't help you.