Broker Fee Ban Temporarily Blocked

  Last modified on March 9th, 2020

Last week, the Department of State issued a new guidance stating that real estate agents representing landlords must collect their commissions from those landlords – as opposed to collecting their fees from tenants, which has always been the industry norm.

The guidance also stated, however, that if a tenant hires an agent to represent them, the agent could still charge them a fee.


The industry went into a quick panic, with REBNY and other groups stating that this would cause many agents to lose their jobs, leaving them with no means to pay their bills. Many in the real estate industry also argued that the ruling would not actually help tenants afford apartments, as landlords would simply end up compensating for the fees they’d have to pay by increasing the monthly rents on their apartments.

REBNY and other groups stated they’d be filing an appeal to block the decision, which they did. The judge presiding over the case offered a temporary block on the rule, which means that at least for now, landlord’s agents can continue to collect their fees from tenants. The DOS will officially respond on March 13th.

The following joint statement was made by James Whelan, REBNY’s president, and Jennifer Stevenson, the president of the New York State Association of Realtors.

“The entry today by the Court in Albany of an order temporarily halting the implementation of New York State Department of State’s (DOS) interpretation of the Statewide Housing Stability and Tenant Protection Act means that thousands of hardworking, honest real estate agents across New York State can do business in the same way they did prior to last week’s DOS memo without fear of discipline by the DOS.  We look forward to ultimately resolving this matter in Court in the weeks ahead.  Meanwhile, we appreciate all of our members’ support and vigilance during this period of upheaval and confusion.  We also want to thank Claude Szyfer and his team at Stroock & Stroock & Lavan LLP for their tireless efforts on this matter.”

Meanwhile, many continue to support the guidance, including the mayor.

“If we don’t take these kinds of aggressive actions quickly [NYC] is not going to be livable for working class and middle class people,” de Blasio said.

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