New York residential lease agreements are contracts between the landlord or property owner and the tenant. Although you are free to contract with your tenant and to charge whatever rent you wish, provided rent stabilization laws are not applicable, there are certain duties you have as a landlord. You also have to respect the rights of the tenant who also has certain obligations to you and to the premises being leased.
New York has some of the most comprehensive landlord/tenant laws in the country and most are designed to protect the tenant but you have certain protections as well. A properly drafted New York residential lease agreement should advise the tenant of both parties’ rights and responsibilities and hopefully provide for a harmonious relationship.
Contents of the Lease
Most residential leases contain basic content that all leases should contain. Although you can have an oral rental agreement, you leave yourself open to misunderstandings and possible litigation where any outcome is possible. Your written residential lease should contain the following at a minimum:
- Names of the parties
- Names of tenants who will be occupying the premises
- Address of the landlord or where the rent payments are to go and legal documents served-if a designated person or entity, the address must be included
- The duration of the lease term
- Amount of the rent
- Acceptable methods of paying the rent
- Due date for the rent
- Late fees and amount
- Security deposit amount
- Responsibility of the tenant and the landlord or property owner regarding repairs and maintenance, abuse or damage to property
- Restrictions on repairs and maintenance—no painting or adding of appliances without permission
- Right of landlord to entry to perform repairs or maintenance after reasonable notice-give at least 24 hours
- Provision for rent increase (unless rent stabilized)
- Pet clause
- Subletting provision
- Disclose the presence of any lead-based paint or hazards on the property for rental property built before 1978—both landlord and tenant must sign an EPA-approved disclosure form and the tenant provided an EPA pamphlet entitled “Protect Your Family from Lead in Your Home.”
You cannot include a provision whereby the tenant waives his/her right to sue you for personal injury or any other cause of action or to waive any other right granted by law including the right to a jury trial.
Regarding a no-pet clause, if you do allow the tenant to have a pet but then later change your mind and try to enforce it, you will likely lose and may have to pay the tenant’s expenses, including attorney’s fees, if you try to evict the tenant. A better option is to require a larger security deposit from the tenant or reach some other compromise.
The tenant needs to give you notice of intent to sublease, which you may refuse on reasonable grounds. You may not restrict a tenant’s right to sublease in buildings with 4 or more units. The tenant does have to first send you a written request to sublet along with certain information and a reason for the sublet, which you must respond to within 30-days or you are deemed to have consented.
As landlord, you can charge whatever you want regarding the security deposit, though most do not charge more than one month’s rent. The deposit, however, is considered the property of the tenant and you are required to deposit it in a separate bank account in a New York bank. If you have a property with at least 6 units you are leasing, then all security deposits must be placed in an interest bearing account, earning at the prevailing rate.
Once you accept the security deposit and place it in the interest bearing account, you have an obligation to the tenant to provide written notice to the tenant of:
- The name of the banking institution where the deposit in located
- Address of the bank
- Amount deposited
There are certain rights that both you and the tenant have regarding the interest:
- You can collect an annual fee that is equal to 1% of the security deposit.
- The remainder of the interest belongs to the tenant, however, the tenant can designate that the interest either 1) be held in trust for the remainder of the lease; 2) place the interest toward the tenant’s rent, or 3) pay the interest to the tenant each year.
How the Deposit May be Used
Security deposits are an advance on whatever damage occurs to the unit or premises. The damage must not be from normal wear or tear or natural deterioration but have been caused by the negligence or intentional act of the tenant or guest. New York law also allows you to use the deposit funds for unpaid rent and to withhold payment if the tenant breaches other parts of the lease agreement.
Return of the Deposit
You do not have to perform a walk-through of the unit after the tenant vacates but you will want to see what damage, if any, occurred so you can detail it and get repair estimates to be sent to the tenant if you intend to use the deposit for repair expenses. In fact, the tenant may want to do a walk-through with you. If you do see damage, you can discuss it with the tenant and perhaps work out an arrangement for its restoration. You may want to suggest to the tenant to have the unit cleaned professionally. You want the unit back in substantially the same condition as when it was rented.
You may return the security deposit when the tenant vacates or after a reasonable time. The law does not specify any particular time or number of days.
Rent Increases and Withholding
You can raise the rent each year at whatever rate you wish unless it is a rent stabilized apartment or loft. For rent controlled leases beginning in October 2015 through September 2016, the rent cannot be raised for one-year leases if the tenant is paying at the “legal regulated rent” as provided by the rent stabilization laws. You can raise it by 2% for a two-year lease. There is no specific law requiring you to provide advance notice of a rent increase but you do have to give at least the same amount of time as required when you want to terminate the tenancy. If it is a month-to-month, then the notice is 30-days for a rent increase, though you can specify in the lease that you will increase the rent at a certain rate every year.
You may not increase the rent for a discriminatory purpose or in retaliation for the tenant having exercised a civil or statutory right, such as notifying the housing department for a failure to repair or remedy a dangerous or hazardous condition that threatens life, health or safety.
A tenant does have some rights to withhold rent if certain vital or essential services have been disrupted and you fail to remedy the condition. This would apply to inadequate heat, no hot water, gas and electricity malfunctions, plumbing and sewage issues, rodent and insect infestations, mold, leaks, peeling paint, broken locks and lack of or broken door and window guards. The tenant does have to give you time to respond so that you can take prompt measures to remedy the condition. If you do not act and the city sends out a housing inspector, you may be cited for a violation. Depending on the violation, you may have 24 hours to repair a serious one such as lack of heat or electricity or rat infestation, or 90 days for less serious ones.
Your tenant may also opt to pay for the cost of repairs and deduct the cost from the rent so long as you were given an opportunity to remedy the condition or hazards.
Lease Extension and Termination
You do have to give your tenant advance notice if your lease has an automatic renewal clause between 15 and 20 days before the tenant is to give notice of intent to not renew the lease. For other renewals, give the tenant 60 days’ notice. If the tenant accepts, the tenant has 30 days to sign and return the lease.
Landlords need to give a tenant 3-days’ notice to pay or vacate for nonpayment of rent. If neither occurs, you can sue for eviction. Different rules apply for rent stabilized units.
The New York 30-Day Notice of Termination is used to evict a tenant who has stayed after the lease has expired, or for other lease violations.
A victim of domestic violence can terminate the lease by giving you 10 days’ notice with a court order to that effect. The tenant does have to demonstrate a continuing substantial risk of physical or emotional harm to her or the tenant’s child from the party who is the subject of an order of protection. All rent must be paid that is due under the lease through the date of the termination date.
Obligations of the Landlord
As landlord or property owner, you are promising, or are deemed to covenant, that the premises and all common areas are fit for human habitation. You also covenant and warrant that the premises does not contain any hazardous or dangerous conditions that would risk the life, safety or health of the tenants. If the tenant causes such a hazard, you are not breaching your covenant or legal duty.
You do have an obligation to keep the roofs, yards, courts, passages, and alleyways clean and free from garbage, vermin or any other condition hazardous to life, health or safety. Any carpeting or rugs that are used in public areas need to be cleaned at a minimum of once per year or as often as the housing department deems necessary. Landlords also must paint or paper the interior surfaces of walls for every multiple dwelling, in public or tenant occupied areas, and be kept in a sanitary condition. All dwellings must be kept rodent or rat-free.
You are also obligated to provide smoke detector devices in each apartment for multiple dwellings and carbon monoxide detectors for multiple dwellings as well as one and two family homes in New York City.
Your obligations or liability is excused if the tenant’s negligence or actions caused or continued solely by the tenant.
However, New York laws are very strict regarding disclosures of lead-based paint and if a tenant is injured from lead paint. You face a civil fine of up to $16,000 for each violation of an EPA requirement and 3 times whatever damages the tenant suffers from lead poisoning or any other condition related to it.
New York’s laws on rent, landlord obligations, lease termination, violations and other matters pertaining to residential lease agreements can be complicated. Consult with a landlord/tenant attorney if you have any question and to ensure that your New York residential lease agreement complies with state and municipal laws and ordinances.