New York City’s vacancy bonus repeal took effect on June 14, 2019, when the Housing Stability and Tenant Protection Act (HSTPA) eliminated the statutory rent increase landlords once collected each time a rent-stabilized tenant moved out. The 20% vacancy bump, the longevity bonus tied to long tenancies, and high-rent vacancy decontrol all ended the same day. A stabilized apartment’s rent now carries forward from the prior lease, adjusted only by Rent Guidelines Board increases and any approved apartment improvements.
What the Vacancy Bonus Used To Do
Before June 14, 2019, the Rent Stabilization Code gave landlords an automatic rent increase whenever a stabilized unit turned over. A new tenant signing a two-year lease could be charged 20% more than the outgoing tenant’s legal regulated rent, with a somewhat smaller increase on one-year leases. No DHCR approval was needed. The bonus was built into every vacancy lease.
On top of that, a longevity bonus added roughly 0.6% for each year the outgoing tenant had lived in the unit, provided the prior tenancy ran at least eight years. A 20-year tenant leaving triggered a combined increase that dwarfed the annual guideline adjustment, and no physical work on the apartment was required to collect it.
The bonus also fed a second mechanism: high-rent vacancy decontrol. Once the legal regulated rent crossed a dollar threshold at vacancy, the apartment left rent stabilization permanently. At the time of repeal that threshold was $2,774.76 per month.1NYC.gov. Protections for Rent-Regulated Tenants Each turnover pushed units closer to the line, and tens of thousands of apartments exited the stabilized stock this way between 1994 and 2019.2Rent Guidelines Board. Deregulation FAQs
What HSTPA Changed on June 14, 2019
The HSTPA ended the vacancy bonus, the longevity bonus, and high-rent vacancy decontrol in a single stroke.3New York State Attorney General. Changes in New York State Rent Law There was no phase-in. Any vacancy on or after that date fell under the new rules regardless of when the prior lease started.
The law also extended the lookback period for rent overcharge complaints from four years to six, and stretched the treble damages window for willful overcharges to six years as well.4New York State Homes and Community Renewal. Strengthening New York State Rent Regulations – The Housing Stability and Tenant Protection Act of 2019 A landlord who continued applying vacancy-style increases after the repeal faces refund exposure, and potentially triple that amount, going back six years.
How Rent Is Set on a Vacant Stabilized Unit Now
When a rent-stabilized apartment turns over today, the incoming tenant’s legal regulated rent starts at the same figure the outgoing tenant was paying. The only automatic adjustments are the annual increases the NYC Rent Guidelines Board approves for one-year and two-year leases.5Rent Guidelines Board. Rent Increases FAQs If the Board approved a 2.75% increase for a one-year renewal in a given cycle, that same percentage is the ceiling for a new vacancy lease in that cycle. The double-digit jumps that once came with every turnover are gone.
Every vacancy lease must include a stabilization lease rider, printed in a size larger than the lease itself. The rider has to disclose the prior legal regulated rent, itemize each adjustment used to calculate the new rent, and include a bedbug infestation history for the unit.6New York State Division of Housing and Community Renewal. Lease Rider for Rent Stabilized Tenants That paperwork is the trail a tenant uses later to check the math.
Owners must register every stabilized unit with DHCR each year, reflecting the apartment’s status as of April 1 and filed by July 31.7Homes and Community Renewal. Rent Registration A new tenant can request the unit’s rent history from DHCR to confirm that the rent on the lease actually traces through legitimate guideline increases and approved improvements.
Apartment Improvements: The Remaining Way To Raise Rent at Turnover
Individual Apartment Improvements (IAIs) are one of the few tools left for a permanent rent increase beyond the guideline. When an owner installs new fixtures, appliances, or other substantial upgrades in a specific unit, DHCR allows an increase based on the cost of the work. HSTPA originally capped IAI spending at $15,000 over 15 years across no more than three projects.
An overhaul that took effect October 17, 2024, replaced the single cap with a two-tier structure.8New York State Division of Housing and Community Renewal. Operational Bulletin 2024-2 – Individual Apartment Improvements
Tier One allows up to $30,000 in improvements over 15 years with no cap on the number of projects. The rent increase is calculated at 1/180th of cost in buildings with more than 35 apartments, or 1/168th in smaller buildings, producing maximum monthly increases of roughly $167 and $179. Tier One work can be done in an occupied unit with the tenant’s written consent in their primary language, or during a vacancy.
Tier Two allows up to $50,000 in improvements over 15 years, but only in vacant apartments. The formula is 1/156th of cost in larger buildings and 1/144th in smaller ones, producing maximum monthly increases of about $321 and $347. Eligibility is limited to units registered as vacant for three consecutive years covering 2022 through 2024, or units where the departing tenant had lived continuously for at least 25 years. Landlords must obtain DHCR certification before claiming Tier Two, and any owner with a treble damages award or harassment finding in the prior five years is disqualified.
The 15-year clock on IAIs runs from the first improvement performed after June 14, 2019, not from the 2024 rule change.
Preferential Rent After a Vacancy
A preferential rent is any amount a landlord agrees to charge that sits below the maximum legal regulated rent. Before HSTPA, an owner could snap the rent back up to the full legal rent at any renewal. That practice ended on June 14, 2019: any preferential rent in effect on or after that date becomes the base for all future guideline increases during that tenancy, and the landlord cannot jump to the full legal rent at renewal.9New York State Homes and Community Renewal. Housing Stability and Tenant Protection Act of 2019 – Rent Laws Overview
When that tenant eventually moves out, the landlord can reset the next tenant’s rent to the full legal regulated rent. But the legal regulated rent itself is frozen at whatever level legitimate guideline increases would have produced. No vacancy bonus is added, and no longevity bonus inflates the figure. Owners with clean DHCR registration records can document the legal rent. Those with gaps may struggle to justify their asking rent, since DHCR can examine up to six years of history when investigating a complaint.10NYC Rent Guidelines Board. The Administration of Rents Under Rent Stabilization – The Role of the Division of Housing and Community Renewal
Note one situation that is not a vacancy at all: when a qualifying family member succeeds to the tenancy after the named tenant dies or permanently leaves, the unit never becomes vacant in the legal sense, and the rent carries over unchanged.11Homes and Community Renewal. Succession
Checking a Post-Vacancy Rent and Filing an Overcharge Complaint
If your rent on a newly vacant stabilized unit seems higher than the guideline math would explain, request the rent history from DHCR and compare it to the figures on your lease rider. Discrepancies between the two are the clearest sign that a phantom vacancy bonus or a miscalculated IAI has been folded in.
To formally challenge a rent, a stabilized tenant files DHCR Form RA-89 by mail or through the Rent Connect online portal.12Homes and Community Renewal. Rent Increases and Rent Overcharge DHCR then examines the unit’s rent history to determine whether every increase was legally justified. Where annual registrations are missing, DHCR can reconstruct the rent at a lower figure.
If DHCR finds a non-willful overcharge, the landlord owes the full overcharge amount plus 9% annual interest.13New York Codes, Rules and Regulations. 9 CRR-NY 2526.1 – Determination of Legal Regulated Rents, Penalties, Fines, Assessment of Costs, Attorneys Fees, Rent Credits A willful overcharge triples: the tenant receives three times the overcharge amount.14New York State Homes and Community Renewal. Fact Sheet 16 – Collecting Overcharges in Rent Stabilized Apartments Both the recovery period and the treble damages window reach back six years from the date the complaint is filed.4New York State Homes and Community Renewal. Strengthening New York State Rent Regulations – The Housing Stability and Tenant Protection Act of 2019