NYC Broker Fees Are Changing: What Renters Need to Know About the FARE Act

Photo by Ricky Singh on Unsplash

By Colin O'Leary

If you’ve ever rented an apartment in New York City, you know the sting of writing a large check for a broker’s fee — sometimes thousands of dollars — just to move into your new home. For decades, it’s been standard for renters to cover these fees, even when the broker was technically representing the landlord. But that’s about to change.

On June 11, 2025, the Fairness in Apartment Rental Expenses (FARE) Act is scheduled to take effect, reshaping how broker fees are handled in residential rentals across the city. Passed by the New York City Council in 2024, the law is designed to make renting more affordable and transparent for tenants.

Under the FARE Act, landlords will now be required to pay the broker’s fee when the broker is working on their behalf to market or lease an apartment. Renters will only be responsible for a fee if they personally hire a broker to help them find and secure a home. This change puts financial responsibility where it belongs — with the party that hired the broker.

This is welcome news for many New Yorkers, especially those struggling to cover several months of rent upfront. Broker fees in NYC have traditionally run as high as 15% of the annual rent — a hefty cost in a city where rent is already sky-high. By shifting this expense away from tenants in most cases, the FARE Act promises significant relief for renters.

However, the law isn’t without controversy. Industry groups, including the Real Estate Board of New York (REBNY), have filed legal challenges, arguing that the FARE Act conflicts with existing state regulations and infringes on property owners’ rights. Despite the litigation, the law is slated for enforcement starting June 11, 2025, though the court’s decision could affect implementation.

So what happens if a landlord or broker violates the new rules? The Department of Consumer and Worker Protection (DCWP) will oversee enforcement. Landlords or brokers found in violation could face fines ranging from $500 to $2,000 per incident, and brokers risk disciplinary action from the New York State Department of State, which oversees licensing.

For renters, the message is simple: starting next summer, you shouldn’t pay a broker fee unless you’ve hired the broker yourself. Understanding who the broker represents is more important than ever. If they’re working for the landlord, the fee is on the landlord — not you.

For landlords, this change requires a shift in budgeting. Broker fees may now become a standard business expense, similar to marketing or maintenance. It’s also an ideal time to review relationships with brokers and ensure they’re staying up to date with local laws.

At The Big City Team, we’re preparing both renters and landlords for this transition. Our commitment to transparency, ethical service, and legal compliance ensures our clients stay informed and protected. We’ll continue to monitor court proceedings closely and share updates that could affect your leases or listings.

Navigating NYC’s rental market has never been simple, but the FARE Act is a major step toward leveling the playing field. Whether you’re renting your first apartment or listing your next investment property, we’re here to guide you through the process with clarity and care.

If you’re in the market to rent a home in New York City and need assistance, contact Colin O'Leary at 646-300-2012 for a complimentary consultation.