Rent Controlled Apt
Hey, I wanted to know if anyone had any insight regarding rent controlled apartments. I’m looking at a 3 family house that has a rent controlled apartment. What would be the quickest way (if any) to get that apartment de-regulated? I read that if that tenant leaves that it becomes rent stablized unless its 6…
Hey,
I wanted to know if anyone had any insight regarding rent controlled apartments. I’m looking at a 3 family house that has a rent controlled apartment. What would be the quickest way (if any) to get that apartment de-regulated? I read that if that tenant leaves that it becomes rent stablized unless its 6 units or more? Any thoughts on that?
Thanks,
Jason
Sure, you can offer anything you want. It’s a free country.
(Except when it comes to owner’s property rights in buildings with rent controlled tenants)
Ok we bought a building with rent control tenants for 1/2 the going rate. We also have had experience with RC tenants. Here are some things you should know besides the ones stated so far.
In order to raise the rent to FULL market rent you have to basically do a gut of everything. Otherwise you can only raise the rent a percentage. The advantage to the gut is (mean) but the RC tenants cant come back to a gutted apt. The other issue of Getting rid of people is if they are over 62 or on some form of disability …….forget it it is a buy out or death.
Basic rule is regardless be civil with all your tenants. It may help when you want them out. I am counting on this now ….we’ll see..
Bottom line we bought a beautiful house that we could no way afford with out the RC tenants and at a good price. Every building we own has had RC tenants and yes its waiting time but now it is worth it.
Yeah, I think the place may still be worth it after hearing these stories. Does this situation allow me to put a low ball offer on the table?
You should probably value the place as if it was a 2 family, with the RC apt. as a burden that’s thrown in as part of a package deal. The 3rd apartment you could look at as buying a lottery ticket every month as long as you’re there. You may lose forever, but hey – you never know. The tenant could die or move out voluntarily and then you’d have a 3 family for the price of a 2 family.
We have good friends who bought a row house in the west village with three RC tenants in place. It took 30 years to get them out. The last lady, a retired lawyer lived on into her 90’s. I recall they were mostly good natured about the situation and understood the dynamics. I think the place is worth like $5 million now
Thanks for all infomation!! this came in very handy.
LOL! the “quickest way to de-regulate an apartment” are you new to our fair city? A diamond may be forever, but a rent regulated apartment is forever and ever.
In marriage, there is divorce. In rent control, there is not.
In marriage, the union does not survive death. In rent control, the marriage survives.
I have firsthand experience of a situation like you’re describing.
If your RC tenant has lived there longer than 20 years, there is literally no way you can evict them (well, as long they pay rent). It’s as simple as that.
And it doesn’t matter if you want to move your sick, retired veteran grandfather into the apartment to care for your kids.
I’ll repeat it to be clear: if your RC tenant has documented evidence that he/she has lived in the apartment for 20 years, there is no way to evict them.
On the plus side, an RC tenant can’t “will” or “deed” the apartment to someone when they die. They would have to have someone else move in for one or two years beforehand (an immediate family member), and that would mean a new lease, and that’s where you have some legal stopping (or slowing) power. Also, the rent increases at a higher rate than rent stabilized buildings — depending on your income, you can apply to raise it up to 7.5% every year.
That being said, it’s as easy to co-exist with your RC tenant as it is any tenant. Mine is great. Quiet, neat, friendly. Pays his rent on time like clockwork.
Don’t buy an RC place unless you’re fully prepared to live with your RC tenant. If you look at the numbers, and they don’t add up — if you’re not getting a hefty discount on the price, to make all the rents = your mortgage — then don’t buy it.
Just like any other place.
PS: one other necessary thing you should do in advance is ask people on the block about the RC tenant. speak to supers of nearby buildings, other long-time neighbors, etc. find out if they’re respected members of the community (or not) and factor in this to your decision.