For newcomers to New York, the city’s apartment rental market can seem bewilderingly complex. New York has about two million apartments and they fall into several categories of housing, some of which are distinct to the city. In this post we will try to take some of the mystery out of the New York rental market by providing an overview of the three main types of rental units.
The three primary types of rental housing in New York are rent-regulated, market rate and subsidized. Rent-regulated housing falls into two categories: rent controlled and rent stabilized. New residents of the city won’t find any vacant rent controlled apartments, because when these units do fall vacant they either become unregulated or rent-stabilized.
Rent-stabilized housing makes up about half the apartments in the city. In this form of housing lease renewals and rent increases are strictly regulated by law and the landlord must follow strict legal guidelines in holdover actions or non-payment rent proceedings. About 100,000 rent-stabilized units come on the market each year. If the new rent is less than $2,500 a month the unit remains under rent stabilization. If the new rent can legally be over $2,500 the unit can be deregulated, although in some circumstances the new tenant can challenge the deregulation.
Market rate housing consists of apartments that have never been rent-regulated or which have become deregulated. Vacant apartments with a monthly rent of over $2,500 are usually market rate. Units in buildings which have one to five units are also generally market rate.
Subsidized housing includes public housing and Section 8 housing which are available only to low-income residents. Another form of subsidized housing is Mitchell-Lama housing, which is for middle-income households. In Mitchell-Lama housing, tax abatements to the owners partially subsidize the rent.
Source: New York City Rent Guidelines Board, “Top Ten List: What Every New Yorker Needs to Know About Rental Housing,” accessed Feb. 16, 2015