File photo of the Statue of Liberty.
New York: The Fairness in Apartment Rental Expenses (FARE) Act went into effect on Wednesday in New York City, ending the longstanding practice that brokers marketing an apartment were paid a fee when a contract was signed and that fee had been paid by the tenant, and instead requiring the landlord to pay the marketing broker's entire fee.
"Such a fee is typically between 10 percent and 15 percent of the annual rent, which means renters might need to pay thousands of additional dollars before they can move in. That is especially burdensome for young and low-income apartment seekers who don't have a lot of cash on hand," reported The Wall Street Journal about the move.
New York is one of the last cities in the United States to eliminate tenant-paid brokers fees. Boston is now the only major U.S. city where tenants are still on the hook for these fees, though there are several proposals before the city government to follow New York and end the practice.
"Some property managers are expected to test the market by imposing major rent increases as soon as the new law goes into effect," noted the report, adding that "a number of brokers have been listing two different prices. One for an apartment before the FARE Act went into effect, and an additional price that was often several hundred dollars more for Wednesday and thereafter."
