Broker’s Fee for Tenants Banned in New York City

New York City-based professional Tami Yassim served as a salesperson for Citi Habitats. Operating in more than 300 neighborhoods around the city, the company works with renters, first-time homebuyers, developers, and landlords to provide an edge to people looking at living in New York City. Tami Yassim was specifically responsible for selling rental apartments through the business.

Renters looking for apartments in New York City were often required to interact with brokers. Brokers virtually controlled all apartment listings, leases, and viewing appointments, and charged broker’s fees to tenants who used their services. Depending on the broker, fees could be up to 15 percent of the tenant’s annual lease fee. Before moving into their apartments, tenants had to pay these fees up front.

However, in February 2020, New York State removed many broker’s fee from the rental process. This banning of fees came as an addendum to rent law enacted in 2019, and stipulated that brokers cannot charge fees to many renters. The exception is when a prospective tenant hires a broker to find them an apartment. Outside of this, broker’s fees must be paid by landlords instead, since they are often the ones who hire brokers to represent them.