Rent stabilized tenants?

We are considering buying a multi-family brownstone that has rent stabilized tenants, with the intention of converting it to a single family home for our family. Does anyone have experience with this process? How long does the process take? What can we do to speed it up? How much money do you need to pay the current tenants (is there a formula, or is it something you negotiate with each tenant)? Thank you.

mgfamily

in Real Estate - General 12 years ago

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livefree | 10 years and 10 months ago

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If you’re rent stabilized, be real careful what you do to “make a buck”. Subletting for more than a proper %, overcharging, having a different primary residence, using the space for business, and trying to outsmart landlords can land you on the street. Either accept a buyout, or live by the rules. Hiring a lawyer is stupid since courts have seen these same lawyers over and over and are getting tired of improper use of the court system. Be careful. You may end up being sued for fraud.

livefree | 10 years and 10 months ago

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Its getting more and more common that rent stabilized tenants are asking for these buyouts that it by itself is illegal, because rent stabilized laws were created not for profit. I’d either stay or take an offer. If you reject an offer, be sure you don’t break any rent stabilization rules, or you’ll be leaving free. If you take an offer, I wouldn’t press my luck and be greedy. Everyone knows about these tactics and courts aren’t feeling sorry for tenants anymore.

nygal | 12 years ago

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I am a tenant in a rent stabilized apt and my landlord is trying to convert the building (read… toss the RS tenatnts to upgrade the building and then charge a lot more rent). They have loosly tossed about the owner occupancy loophole but my lawyer basically says that it is VERY hard to pull it off. A couple on the east side tried this a couple of years ago and the courts told them to forget it. That they could not take the whole building. So in answer to your question, it’s pretty hard, will be very expensive, and may not work in your favor. Personally I would fight to the death to keep my RS apartment and take nothing less than enough dough to buy a place of my own. Times that by several tenents.

mozeeatupu | 12 years ago

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If they’re old or disabled, forget it.  Otherwise everyone has a price but first step would be to send them non renewal notices 3 months before their leases are set to renew.  And get a good attorney, as most of it is paperwork.  Also insist that the tenants also get lawyers as anything without one can be tossed in court.

brokelin | 12 years ago

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“Hi, I want to buy and building and kick out those who currently legally reside there and call it their home.  Will you help me figure out how to do so?”  Tin ear, anyone?

jumping | 12 years ago

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My old housing lawyer told me not to be bought out for less than 10 years worth of rent.

Bklnite | 12 years ago

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“How much money do you need to pay the current tenants …is there a formula?” Buyouts are an art, not a science. If I was a tenant paying close to market I might take 5 or 10 grand to leave. If I was paying $1000 less than then market rent, I’d want hundreds of thousands (or might just say fuggetaboutit).  You can evict based on owner occupancy (not that it would be easy or quick), but you can’t evict someone 62 or older or disabled.  Here’s a fact sheet: http://www.nyshcr.org/Rent/factsheets/orafac10.pdf

Boerumresident | 12 years ago

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It’s not for the faint of heart. Plus every few years some politician raises the idea of abolishing or restricting owner occupancy evictions — Squadron tried this a few years ago, and I think Quinn complains about it (but it’s a state law, so there is not much city pols will do about it legally except make the rest of the bureaucracy sit on the DOB requests to convert the building).

coopking | 12 years ago

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It all depends on the tenants situation. Some will never leave voluntarily and will tie you up in court for years. Others will pack up and leave if you cut them a check for 15K. The last apartment building I lived in had a bunch of rent regulated tenants and the landlord had success getting them to leave with a somewhat decent lump sum of around 50K and bought a crappy house in like Canarsie for them to live in that he rented to them. This was a family of like 5 people mind you.

ejalbk | 12 years ago

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It depends on many factors including how many rent stabilized tenants there are, how far below market their rents are, their ages, how organized they are etc. In short, it’s completely impossible to predict given the lack of information provided. The answer then can range anywhere from not such a big deal to virtually impossible, one year to never, and $10,000 to millions.