Posted by MikeW on July 18, 2001 at 11:03:27:
In Reply to: Legal, IF LL spent that much posted by chelsea on July 17, 2001 at 18:21:38:
The landlord has a contractor come in, do $20K worth of work to an apartment, has the contractor give him a bill for $40K, give the contractor a check for $40K. The contractor gives him, say, $18K back in cash. (as an aside, the LL claims the full 40K as an expense on his corporate tax return). A couple months down the line someone rents the apartment.
Assuming the renter thinks to check the rent registration history, and is willing to challenge the MCI (both of which are not too likely), the LL can show an invoice and a cancelled check. It is now VERY tough for the tenant to prove that the work doesn't justify the cost passed down through the MCI.
: According to my calculations, to bring a rent-stabilized apartment's legal rent from $800 to $2,000 between tenants, the landlord would have to perform about $42,000 in qualifying improvements (assuming a vacancy increase of 18% for a one-year lease).
: To bring a $1,400 apartment to $2,000, about $14,000 would have to be spent.
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