Under the FARE Act (NYC Local Law 119), tenants who previously paid broker fees of $4,000 to $8,000 on a new lease now pay $0 in the majority of rental transactions. In my 25+ years selling and renting in NYC, I have seen the old system from the inside. For a separate set of renter rights, see the reasonable accommodation guide and the FARE Act details.
What changed in spring 2026: NYC's Rent Transparency Act (Local Law 86) took effect January 26, 2026 and now requires buildings with rent-stabilized units to post a notice in English and Spanish in a common area, telling tenants how to check their unit's status. See our Rent Transparency Act guide for the full notice requirements.
What the FARE Act Does
Local Law 119 of 2024 took effect June 11, 2025. Before that date, landlords routinely hired a broker and then had the tenant pay the fee, typically 12% to 15% of annual rent. Now the party who hires the broker pays the broker. In most NYC rentals the landlord hires the listing broker, so the landlord pays.
- Landlord's agents cannot charge tenants. A broker hired by or acting for the landlord cannot collect any fee from the tenant, and that includes brokers under an oral, handshake agreement.
- Listing agents cannot charge tenants. A broker who publishes a listing with the landlord's permission is presumed to be the landlord's agent.
- Nobody can require you to hire a broker as a condition of renting an apartment.
- You cannot opt out. Paying the landlord's broker is not allowed even if you offer.
- You can still hire your own broker. If you choose an independent broker to search for you, you pay that broker.
What the Law Saves You
The old fee scaled with rent. Here is what a tenant would have paid at four monthly rents:
| Monthly rent | Annual rent | Fee at 12% | Fee at 15% |
|---|---|---|---|
| $2,500 | $30,000 | $3,600 | $4,500 |
| $3,000 | $36,000 | $4,320 | $5,400 |
| $4,000 | $48,000 | $5,760 | $7,200 |
| $4,500 | $54,000 | $6,480 | $8,100 |
Why "$5K+"
At a $3,000 monthly rent, the 15% fee was $5,400, and at $4,500 it ran from $6,480 to $8,100, so a tenant at those rents saved $5,000 or more.
What You Still Pay at Move-In
Other up-front costs stay. On a $3,000 apartment:
| Move-in cost on a $3,000 rent | Before FARE | Now |
|---|---|---|
| First month's rent | $3,000 | $3,000 |
| Security deposit (capped at one month's rent, General Obligations Law 7-108) | $3,000 | $3,000 |
| Application and credit check (capped at $20, Real Property Law 238-a) | $20 | $20 |
| Landlord's broker fee (12% to 15% of annual rent) | $4,320 to $5,400 | $0 |
| Cash due at signing | $10,340 to $11,420 | $6,020 |
Fees and Disclosures You Should Expect
The law is a fee-assignment rule, not a price cap. Landlords can still charge fees that state law allows, such as background and credit check fees under Real Property Law 238-a,.
- In the listing: every fee a tenant must pay to rent, including application fees and anything payable before lease signing, must be conspicuously disclosed.
- Before the lease: the landlord or agent must give you an itemized written disclosure of all fees, with a written description of each. You sign it before the lease, you get a copy, and the landlord keeps the signed copy for 3 years.
Two-Rent Pricing and Other Workarounds
Some landlords have considered advertising two rents for one unit: a higher rent if the landlord pays the broker and a lower rent if the tenant does. For a market-rate unit that practice may violate the FARE Act, and rent-stabilized units cannot be priced freely at all. If you see a listing with two rents or a fee you do not recognize, ask for the disclosure in writing.
Enforcement: What to Do If a Broker Charges You
- The NYC Department of Consumer and Worker Protection (DCWP) enforces the law. File a complaint at nyc.gov/consumers or call 311.
- DCWP issues a summons, the case is heard at the Office of Administrative Trials and Hearings (OATH), and penalties can include restitution of an illegal fee to you.
- Tenants can also sue in civil court.
Practical Steps Before You Sign
- Ask whether there is a broker fee and who is responsible for it, and request the itemized fee disclosure in writing before the lease.
- Keep any agreement about fees in the lease or a signed rider.
If you are weighing a purchase instead, our renting vs. buying analysis and buyer guide can help. For personalized assistance, visit miltoncoste.com or call me directly at (917) 416-7433.
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Milton Coste
Licensed Real Estate Associate Broker · Keller Williams NYC
License No. 10301213304 · 360 Madison Avenue, 9th Floor, NY 10017
Equal Housing Opportunity. We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. Milton Coste and Keller Williams NYC are committed to full compliance with the Federal Fair Housing Act (42 U.S.C. §§ 3601-3619), the New York State Human Rights Law (Executive Law, Article 15), and the New York City Human Rights Law (Title 8, NYC Administrative Code).
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Content published: February 2026 · Milton Coste · Keller Williams NYC · License No. 10301213304
