NYC’s FARE Act Is Shifting Broker Fees — and Rents Are Responding

As of June 11, 2025, the Fairness in Apartment Rental Expenses Act (FARE Act) is officially in effect across New York City—and it’s already reshaping the rental market in ways that every New Yorker should understand.

  WHAT IS THE FARE ACT?

Passed in late 2024–with a veto proof majority–and enacted this summer, the FARE Act (Local Law 119) requires that whoever hires a broker must pay their fee. In most cases, that’s the landlord—not the tenant.

Key changes:

• Landlords can no longer offload the expense of the broker fee to a tenant if the broker is hired by the landlord 
• Any required fees must be clearly disclosed in listings and lease agreements.

  WHY RENTERS INITIALLY CELEBRATED

The law was designed to reduce upfront costs for tenants—who have historically been hit with broker fees of up to 15% of annual rent, as well as multiple months of rent and security, especially before the Housing Stability and Tenant Protection Act of 2019 (HSTPA) was passed by our State Senate. The FARE Act may indeed succeed at reducing upfront costs. In fact, StreetEasy estimated that move-in costs could drop by over 40% under the new law. But here’s the catch…

  RENTS ARE RISING

While tenants may save on broker fees, reducing upfront costs, landlords are responding by raising monthly rents to offset this expense, adding to the long term expenses of all tenants, not just those currently looking for a new lease.

Some examples:

• A Park Slope unit saw a $495/month increase overnight according to CRE Daily
• Across various neighborhoods, average rent has jumped from $4,750 to $5,500—an increase of over 15% in just weeks.
• Reports from agents and renters confirm that many new listings are hitting the market at a 10–15% premium compared to just a few months ago.

Broker fees are a one-time cost—but higher rent is forever, especially for market-rate apartments.

  WATCH FOR HIDDEN FEES

Despite the new regulations, some agents and landlords are trying to skirt the rules. Tenants have reported additional charges labeled “management” or “technology” fees—sometimes totaling over $4,000—that resemble the banned broker fees.

City agencies are investigating. Over 300 complaints have already been filed, and violators can face fines of $500–$2,000 per offense.

  TAKEAWAYS FOR RENTERS AND LANDLORDS

For Renters:

• Expect lower upfront costs, but don’t be surprised if you’re asked to pay increased rent if you’re in a free market apartment–yes, even if you’re renewing a longstanding lease and not searching for a new unit
• Be on the lookout for disguised or renamed fees if you’re applying to any new apartments
• If you think you’re being charged a broker fee on a landlord-represented listing, report it to 311 or the NYC Department of Consumer and Worker Protection.

For Landlords:

• You must pay broker fees for your own listings and cannot pass them along to tenants.
• Budget accordingly—this law shifts costs in your direction, and enforcement is active.
• Insist your agent err on the side of transparency when it comes to all fees, deposits, etc., for your listings

  THE BOTTOM LINE

The FARE Act aims to rebalance the rental process. As is often the case, well-meaning but poorly considered or executed legislation doesn’t always have the desired effect. Early signs show that many landlords are passing their costs along in the form of higher rents. As the city adjusts, the long-term effects remain to be seen.

Whether you’re renting, leasing out an investment, it’s more important than ever to read the fine print, stay compliant, keep an eye on both the rent and the fees, and use good help. Reach out to us today if you have any questions about how the FARE Act may impact your plans.