Your Rights When a Landlord Sells in NYC: What Every Tenant Should Know
Your Rights When a Landlord Sells in NYC: What Every Tenant Should Know
The decision by your landlord to sell their property can feel unsettling. It brings up a lot of questions: "Can I be evicted?" "Does my lease become void?" "What about the security deposit?" The good news is that in New York City, tenants have a comprehensive set of rights that protect them during a property sale. You do not lose your home simply because ownership changes.
This guide, from your trusted partners at Yeo Real Estate, breaks down everything you need to know about your rights and what to expect when a landlord sells in NYC.
1. Does a Property Sale Terminate My Lease?
This is the most critical question, and the answer is a definitive no.
A sale of a rental property in New York does not, on its own, terminate an existing lease. Under New York State Real Property Law, the new owner inherits the property subject to the existing lease. This means your lease, along with all its terms and conditions, remains in effect until its expiration date.
For Leaseholders: If you have a valid, unexpired lease, the new owner must honor it. They cannot raise your rent (beyond what's stipulated in the lease), change the terms, or ask you to move out before your lease ends.
For Month-to-Month Tenants: If you do not have a lease and are a month-to-month tenant, the new owner still cannot evict you without following the proper legal notice requirements. The new owner must serve you with a written notice to terminate your tenancy, with the amount of notice required dependent on how long you have lived in the unit.
Key takeaway: Your lease is a binding contract that follows the property, not the person who owns it. The new landlord steps into the shoes of the old one, and your rights as a tenant do not change.
2. What Happens to My Security Deposit?
This is a major point of concern for many tenants. Fortunately, the law is clear.
When a property is sold, the old landlord (the seller) is legally required to transfer your security deposit to the new landlord (the buyer) within five days of the closing. The new owner then becomes fully responsible for holding and returning that deposit to you at the end of your tenancy, according to the terms of your lease and state law.
You should receive written confirmation from your old landlord, via certified or registered mail, that the security deposit has been transferred, including the new owner's name and address. It’s always a good idea to keep a copy of this notice for your records.
3. What Are My Rights Regarding Showings and Open Houses?
This is often the most disruptive part of a sale for a tenant. While your landlord does have a right to show the apartment to prospective buyers, they cannot do so at will.
Here are your rights:
Right to Reasonable Notice: The landlord must give you reasonable notice before entering your apartment. While there is no specific law defining "reasonable notice," it is generally understood to be at least 24 hours. The landlord can only enter at a reasonable time, typically during normal business hours.
No Harassment: Your landlord cannot harass you with a constant barrage of showings or open houses. The purpose of these visits must be genuinely to show the property to serious buyers. Excessive or repeated entry that interferes with your "right to quiet enjoyment" of the property constitutes harassment, which is illegal.
Right to Privacy: You have the right to privacy in your home. Your landlord cannot bring potential buyers into your apartment without your consent and proper notice. They also cannot allow anyone to take photos or videos of your belongings without your explicit permission.
If your landlord or their agent violates these rights, you should document every instance and consider seeking legal counsel or contacting the NYC Tenant Protection Unit.
4. What If the New Owner Wants Me to Move Out?
This is a common scenario, especially if the new owner intends to occupy the unit themselves. Even if they plan to live there, they cannot force you to move out before your lease expires.
However, a new owner may offer a "cash for keys" agreement. This is a legal and often mutually beneficial way for both parties to end the lease early. Here’s how it works:
The new owner offers a sum of money (the "cash") in exchange for you agreeing to move out by a certain date (the "keys").
This is a voluntary negotiation. You are under no obligation to accept the offer. You have the right to say no and stay until the end of your lease.
If you decide to accept, it is crucial to get the agreement in writing. The agreement should clearly state the amount of money, the move-out date, and any other conditions. Do not move out or sign any document until you have the agreed-upon payment.
Scenario: Your lease expires in 10 months. The new owner wants to move in immediately and offers you $20,000 to leave in 60 days. You are free to accept or decline. If you decline, you have the right to stay for the full 10 months. If you accept, you get a substantial payment to help with your move.
5. Are There Different Rules for Rent-Stabilized Apartments?
Yes. If you live in a rent-stabilized apartment, you have even stronger protections. The sale of the building does not affect your rent-stabilized status.
Lease Renewal: The new owner must offer you a lease renewal at the end of your current term. They cannot refuse to renew your lease without a legally valid reason, such as you not using the apartment as your primary residence or violating the lease terms.
Rent Increases: The new owner is bound by the rent increases set by the NYC Rent Guidelines Board. They cannot raise your rent above the legally regulated limit.
Succession Rights: Your succession rights, which allow a family member to take over the lease, also remain intact.
The new owner inherits all the obligations and restrictions that come with a rent-stabilized building. These protections follow the apartment, not the owner.
Tips & Takeaways for Tenants
Know Your Rights: Your lease is your primary protection. Know your lease terms, and understand that it remains valid even after a sale.
Communicate in Writing: If you need to communicate with your landlord or the new owner, do it in writing and keep a record of all correspondence. This is vital for legal protection.
Be Polite, But Firm: You can be cooperative with showings and requests while also being firm about your legal rights, such as proper notice.
Document Everything: Take photos or videos of your apartment's condition before and after showings to protect your security deposit. Document every instance of a violation of your rights.
Don't Be Pressured: You have the right to stay in your home until your lease expires. Do not feel pressured to leave or to accept a cash-for-keys offer that doesn’t meet your needs.
Looking to Buy, Sell, or Rent in NYC?
Whether you're navigating a landlord's sale or planning your next move, having a knowledgeable partner by your side makes all the difference. At Yeo Real Estate, we are experts in NYC's complex real estate market and are committed to protecting your interests. Contact us today for a free consultation.