Manhattan, N.Y.
NEW YORK CITY- A New York judge has issued a temporary injunction on the Department of State guidance banning tenant-paid rental commissions to landlord-retained real estate agents.
The Real Estate Board of New York and New York Association of Realtors along with several other prominent local brokerages joined forces and filed Article 78 in response to the guidance in Albany County Supreme Court on Monday. The plaintiffs deemed the new guidance created "havoc and confusion" within the real estate industry.
The guidance, which was announced last week, was the first announcement the Department of State made to bring further clarification to the Housing Tenant and Protection Act passed into law in June 2019. But the clarification had the opposite intended effect.
The real estate industry was flipped upside down on its head as many rushed to further understand what the rental-fee ban meant for their businesses and a new broker-fee economy.
The plaintiffs pleaded that the court restrain the new guidance, which would subject real estate brokers to severe injury, including the loss of income and, or jobs.
Following the injunction, REBNY and NYSAR said in a statement, "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."
Another hearing of whether the restraint is justified is set to take place. Reportedly, REBNY is due back to court March 13 as stated in an email to its members.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Mariah Brown
Mariah Brown is the New York Bureau Chief and Real Estate Reporter for GlobeSt.com, covering the New York Metro area, Northeast region and national real estate trends. She is responsible for producing multi-media content, including articles, podcasts and video. Before joining the GlobeSt team, she served as a New York Times fellow, reported for the Associated Press in New York and Philadelphia and several other New York City-based outlets.
