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Reasons my apartment isn't RS

NYC Rent Regulation: Rent Control/Rent Stabilized, DHCR Practice/Procedures

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Reasons my apartment isn't RS

Postby Micky86 » Sun Jun 18, 2017 5:04 pm

Hi all, I hope you can help me with something.

I was wondering what reasons there could be a cheaper apartment is not regulated by rent stabilization. I've done a lot of googling and all I can find is if it is deregulated because of high rent. There are I guess the subsidies, but wouldn't a $1,250 apartment, still be subject to RS when they stop? (8 units, build in the 30's)

Also, can I sign the lease while I'm finding out if I'm paying too much for my apartment?

How did get to look for this answer?

My (now) wife has been living in this apartment for over a decade and I moved in with her 2 years ago. She signed a lease when she moved in and since then used verbal renewals with the landlord. In those 10 years he only raised the rent once or twice. My wife is neither the person to look into this, nor was there a need to know if the place was RS and I just moved here from Europe so didn't know anything to begin with.
Now around the time I moved in, her LL passed away and his family/corporation took over managing the building. That is when we actually had to start signing leases again. In the 3 leases since we went from $1,250 to $1,450 and now they are asking for another $200 increase.

We wrote them saying the increase was a bit steep and they offered to lower it by $50, but also stating the apartment does not fall under RS and the rent is still under market value (which is true).
The lease also says the apartment is not subject to rent regulations, but we can't find the lease from 10/12 years ago.

I did my research and the building is on the RS list from NYCRGB and I know it doesn't say anything about which apartments.
Tomorrow I'll also go to the DHCR office to find out the rent history.

Thank you for any help and information you guys can give me.
Micky86
 
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Re: Reasons my apartment isn't RS

Postby TenantNet » Sun Jun 18, 2017 6:32 pm

There's no 100% exhaustive list of what makes a unit RS, or not.

But we start with:

a) built prior to 1974

b) 6 or more units (or had 6+ units at any time even if some have been combined to make less than 6 units)

c) not a coop or condo (except original RS tenants get to keep their RS status)

Then things get complicated...

d) the unit hasn't been deregulated due to high rent or high income deregulation

e) the outer walls of the unit have not substantially changed

f) some units that were exempt for reasons such as owner occupancy do not return to RS if returned to regular rental, although a super's apartment generally does return to regular RS).

Then you get into issues of tax abatements, and I won't even attempt to get into those details, but if a unit received the benefits of a 421-a or J-51 tax abatement for substantial rehab, it generally is RS, but not in all cases.

Various schemes like Section 8, HDFC, TIL, supportive housing, SRO, etc., are generally RS, or follow the RS rules.

When your wife signed the lease initially, was it a RS lease, and have any renewals been on DHCR's renewal lease form? Have increases followed RGB allowable percentages?

Have you gotten a rent history from DHCR? That's a starting point. That will likely give you a clue if it was ever registered, when it stopped, and if there was a reason cited.

I'd also look at the building history - look at Building permits, and look at Finance documents (the ACRIS system with the Dept. of Finance). Get a complete picture of what has happened over the years.

For right now, as you're snooping around, do not let the LL know your investigating.

The list of RS "buildings" simply means some units in the building are subject to RS, not the building. It's a misnomer. But if some units are RS, then that narrows the possible reasons for their claim of it not being RS.

There is a 4 year stature of limitations on overcharges (except for fraud), bit no limitations on RS status. At some point you may have to ask the LL why they claim it's not RS, but I'd wait until after you've done as much research as you can.

But if your in a casual conversation, you might just ask why, just being curious, and see what they say. Down the road you might decide to file a complaint, but wait until you have as much information as possible.
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Re: Reasons my apartment isn't RS

Postby Micky86 » Tue Jun 20, 2017 5:33 pm

Thank you very much for your quick answer.

Went to the DHCR yesterday and unfortunately it went Permanently Exempt for high rent the year before my wife moved in. Not sure what to think of the increases of the legal rent in the few years before that though.
2001: $1000
2002: $1230 (new tenant)
2003: $1700 (new tenant)
2004: Exempt.

Even is there was fraud, the guy at the DHCR said it would be very hard to prove so many years back.
Micky86
 
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Re: Reasons my apartment isn't RS

Postby TenantNet » Tue Jun 20, 2017 5:51 pm

Do you mean deregulation due to high rent? The term "permanently exempt" usually implies something else.

Back then the threshold for high rent deregulation was $2,000. Now it's $2,700. If the legal rent gets above the threshold, then it can be deregulation. But you can scrutinize and challenge the method used to get above the threshold.

However, unless there's fraud, the statute of limitations is four years. If they said they made certain improvements in order to jack up the rent, and in fact the work was not done, then that's fraud. If they did certain improvements in 2004 and had done the same improvements only a year or two prior to that, then that's not allowed. The useful life of the improvements would not have expired.

Many - I would say most - landlords exaggerate if not outright lie about the improvements and how the rent increases are calculated.

Yes, it can be difficult, but it's not impossible.

This might qualify for an "Altman" exception, a case that is currently pending before the NY Court of Appeals. That means that while any improvement can jack up the rents, they don't trigger deregulation until the next tenant comes along.

To look at that closer, I'd consult with a tenant attorney and make sure they have been following the Altman case. It may be several months before the high court makes a final decision.

One other thing, you mention the rents in round numbers, i.e., $1000, $1700 and so on. That's usually a sign that something is wrong. RS rents are calculated based on percentages. So you might end up with a rent that looks like $1,730.27 and not an even $1,700. Final thought ... did the rent history go back to 1984? You started at 2001. Get it all the way back,
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