New Bill Would Require Written Buyer Broker Agreements in NY

A new bill introduced by Assemblymember Cruz, Bill A08910, proposes significant changes to New York’s real estate brokerage law. If enacted, the bill would add Section 442-m to the Real Property Law and modify Section 443, the existing agency disclosure statute, to require written Buyer Broker Agreements (BBAs) that include clear and conspicuous disclosures about compensation.

Key Requirements Under the Bill

Under the Bill, a Buyer's Broker Agreement (BBA) must contain the following:

(a) Clearly and conspicuously contain the following disclosure: "Compensation is not set by law and is fully negotiable."

(b) The name, address and contact information for all parties to the agreement;

(c) The length of the agreement including the length of any condition under which the real estate broker may still have a claim for compensation after the agreement expires;

(d) The type of agency relationship between the buyer and the real estate broker; and

(e) The terms of compensation, including:

(i) The amount the buyer agrees to compensate the real estate broker;

(ii) How the amount of compensation will be determined;

(iii) When compensation is earned by the real estate broker;

(iv) When compensation is due to the real estate broker;

(v) The consent of the buyer if the real estate broker will share any compensation with another broker;

(vi) The consent of the buyer if the broker will be requesting any compensation from another party; and

(vii) The consent of the buyer if the broker will be compensated by more than one party.

Potential Legal Conflict: Statute of Frauds

Although transparency is a worthy goal, this bill raises legal questions. Notably, it may conflict with the Statute of Frauds under GOL § 5-701(a)(10), which exempts licensed real estate brokers and salespersons from the written contract requirement. Additionally, duplicating agency disclosures, first in the statutory disclosure form and again in the BBA - could be viewed as superfluous and if they conflict, real issues could emerge.

Why Brokers Should Pay Attention

While this bill hasn't advanced in the legislature and is not law yet, it's a clear signal of where things may be headed in response to commission related scrutiny across the industry. Smart brokers can use this bill as a template to proactively strengthen their buyer's brokerage agreements, improve transparency, and minimize legal risk.

📞 Need Help Drafting or Reviewing Your Buyer Broker Agreement?

The proposed legislation may not be law yet - but smart brokers get ahead of compliance.
Contact Lieb at Law, P.C. to review your current agreements or create custom templates that protect your commissions and meet evolving legal standards.

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NYC Provides Protections for Individuals with Criminal Histories from Discrimination

NYC has clarified that it is illegal to discriminate in housing against applicants / occupants with criminal histories by way of Local Law 24, also known as the Fair Chance in Housing Act 2025, effective January 1, 2025. 

That said, it was already impliedly the law everywhere throughout the US as we previously explained here. 

Regardless, the new NYC law explicitly prohibits property owners, managers, & brokers from:

• Refusing to rent, sell, and/or lease housing accommodations based solely on criminal history, except under specific circumstances outlined in the law.
• Performing criminal background checks outside the law's defined parameters, including searching records and/or asking applicants about their criminal history without proper notice & justification.
• Using criminal history to set terms or conditions that disadvantage individuals with such backgrounds.

Into the weeds, there is nuance in the NYC Local Law because it differentiates between “reviewable” and “non-reviewable” criminal history where sealed convictions, youthful offender adjudications, and certain federal or out-of-state offenses cannot be used to deny housing, but convictions for serious offenses (e.g., recent felony convictions) may be reviewed through a detailed and exposure riddled process, including providing notice and conducting an individualized assessment. The process requires: 

• Making a conditional offer to the applicant.
• Notifying the applicant in writing of any intended criminal background check.
• Allowing the applicant to provide mitigating information if adverse action is contemplated.

Plus, a landlord must demonstrate a legitimate business interest tied to the decision if they'd like to deny on criminal history. 

That all said, the main takeaway is that housing applicants / occupants with criminal histories are going to be filing housing discrimination complaints starting in 2025. If you are a property owner, manager, or real estate broker, expect to get served by the NYC Commission on Human Rights if you plan to make any housing decisions based on an applicant's / occupant's criminal history. Plus, there are big numbers that you can lose including the "victim's" attorneys' fees if they sue you with a private attorney. Take this very seriously & immediately stop screening based on criminal history today. 

NYC’s Rental Game-Changer: New Law Shifts Broker Fees to Landlords

The New York City Council has approved the FARE Act (Int 0360-2024), a new bill that eliminates upfront broker fees for most renters. 

Currently, New York is one of the only places in the country where tenants are required to pay these fees, often around 15% of the yearly rent, even when they’ve never met the broker. This has meant an average upfront cost of $13,000 for renters, which includes broker fees, security deposits, and first month’s rent. Under the FARE Act, the responsibility for paying the broker fee will shift to the party that hires the broker - usually the landlord or building manager—unless the tenant specifically hires the broker. 

The bill passed with solid support, at 42 votes to 8. Proponents argue it’s common sense that the party hiring the broker should pay for their services, adding that the FARE Act will help make housing more accessible for working- and middle-income renters. However, critics, including the Real Estate Board of New York (REBNY), have raised concerns that the law could lead to higher rents, make it more difficult to find housing, and harm brokers.

The mayor has until December 13, 2024 to sign the FARE Act, after which it becomes law and takes effect 180 days later. 

Stay tuned to see how the FARE Act impacts the NYC rental scene. For better or worse, it's sure to be a game changer. 

Can NY Landlords Ban Firearms?

 

Attorney Andrew Lieb is quoted in City Limits explaining how NY gun laws apply to landlords. 

No Loud Music. No Smoking. No Guns. Can NYC Landlords Ban Firearms?

Landlord Liability for Tenant-on-Tenant Discrimination: Split in the Federal Circuits | New York Law Journal

Sharing Andrew Lieb's article published in the New York Law Journal. Landlord Liability for Tenant-on-Tenant Discrimination: Split in the Federal Circuits. For anyone who doesn't subscribe a text version will be available on the Lieb at Law website.

Landlord Liability for Tenant-on-Tenant Discrimination

Summary of the Tenant Protection Act of 2019 for General Landlord/Tenant Practice

The Housing Stability and Tenant Protection Act of 2019 is a 74 page Act. Andrew Lieb, Esq. summarizes the list of major changes applicable to general landlord/tenant practitioners.

Read the full article in the Suffolk Lawyer Law Journal here.