renting with the 421a
My understanding is that if an apartment building is built and receives the 421a tax benefit it will be subject to rent stabilization for the duration of the abatement. However, the initial rents are set at market so the leasehold advantage is not all that great. What I am unclear about is if I were…
My understanding is that if an apartment building is built and receives the 421a tax benefit it will be subject to rent stabilization for the duration of the abatement. However, the initial rents are set at market so the leasehold advantage is not all that great. What I am unclear about is if I were to purchase a condo unit within a building that is receiving the 421a and I were to rent out my unit, would that lease be subject to rent stabilization for the duration of the abatement?
All this stuff kind of confuses me and I was just wondering if anyone out there has done some research. Thanks!
It is true that rental units under 421-a must be rent stabilize during the duration of the abatement. Co-op and condo owned units are EXEMPT from this rule.
So yes, you can rent out your condo at market price.
However, make sure you bring this up to your RE attorney so he can check the Offering Plan before you sign. He should check that there are no rules under the first year of operation where the sponsor often control the condo board.