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I signed a 2 year lease that started 10/1 for $3350 and was never presented a countersigned copy of the lease or any copy of the lease at all. I inquired with the management company this week to receive a copy of the lease. Thats when things got complicated.
They replied to my inquiry with.... "For your lease, we need to make some changes to the forms. The apartment is rent stabilized and upon the prior tenant’s vacancy, a vacancy increase should have been added to the legal rent of the apartment. You will still receive preferential rent for the lease term which is equal to the rent you’ve agreed upon. A revised rent stabilization rider and also a preferential rent rider are attached for your signature."
I knew I was signing a rent stabilized lease but there was zero mention of it being a preferential rent and no mention of it in the original lease. The preferential rent rider essentially says that the preferential rent will be honored for the term of the original 2 year lease but after that the legal regulated rent of $3960 would be used. Meaning they will be able to charge $4k+ when it comes time to renew.
My question is, am I by any means obligated to sign these riders because of their mistake? Especially given that there was zero disclosure that the rent was a preferential rent at the original lease signing or mention of it in the original lease?
It is also worth mentioning that this building is less than a year old and I am the 2nd tenant of this unit. The original tenant was getting out of the lease and the unit was placed back on the market while it was still occupied. That tenant moved out at the end of September and I moved in the first week of October. On the rent stabilization rider it appears the last tenant was paying $3300.
First, I think that if the rent is over $2,500 (it may have been increased in the last couple of years but nowhere near $3,350 or $3,960) the landlord can destabilize the apt and charge whatever they want. Really, the market determines what they charge if he max authorized rent is $2,400 but the area/apt/whatever only make it worth $2,000, then they rent it for what they can obtain, rather than a higher rent that they cannot.
If the landlord has not signed the lease, then there is no enforceable lease. Legally, you most likely have no rights. Even though there was "a meeting of the minds", there is something called the Statute of Frauds, that requires contracts involving real estate to be in writing and signed by the parties being bound. An oral contract can be executed but not enforced. For example, I have a vacant lot upstate and agree to sell it to you for $100,000, on a handshake deal. We can sign the deed, pay the money, record the transaction and it will have been an executed contract. If you show up at closing with $100 large, and I change my mind, there is no deal. You cannot force me to sell it to you because it wasn't signed by me, one of the parties to be bound.
Odds are that they can tell you to take a hike if you don't sign the riders. In short, you have no legal grounds if they haven't yet signed it. If they rented to you for $3,350, they can most likely find someone else to pay that with the lease having the appropriate riders of attached.
Since you have possession, it may be considered an executed contract that can go along fine for 2 years, BUT, without a written lease you are subject to eviction with a written notice. The old "Catch 22" I am afraid.
Good luck arguing but I think you have no legal basis not to sign, unless you know and can prove that the agreement was signed by the LL, thereby binding in writing, "a party to be bound." I think notification must be made to all parties, usually by delivery of fully executed copies. If you don't have one most likely you are screwed. There was an appellate case a few years ago concerning an emailed contract, but you don't mention email. "The New York Appellate Division's (First Department) recent decision in Naldi v. Grunberg held that "an electronically memorialized and subscribed contract be given the same legal effect as a contract memorialized and subscribed on paper."
I am not a licensed attorney in New York and not able to provide legal advice. If you feel you need legal advice, you should consult an attorney.
First, there is no such thing as "preferential rate". That's something new that management companies adding on into making a tenant feel like they got a deal. At the same time, it allows them to auto adjust the rent should they get greedy and want more money. It's horrible. Rent stablized ion allows for certain % increases each year. Preferential gives the management co an excuse to be greedy bastards in the event they want more money.
I doubt they'll do that to you, but you should ask for all types of riders because it could be your word against theirs. Don't forget about bed bugs and other riders.
They'd be dumb to do that to you because if you move, it'll be months before they fill the apartment again. That monthly rent is beyond ridiculous.
First, there is no such thing as "preferential rate". That's something new that management companies adding on into making a tenant feel like they got a deal. At the same time, it allows them to auto adjust the rent should they get greedy and want more money. It's horrible. Rent stablized ion allows for certain % increases each year. Preferential gives the management co an excuse to be greedy bastards in the event they want more money.
I doubt they'll do that to you, but you should ask for all types of riders because it could be your word against theirs. Don't forget about bed bugs and other riders.
They'd be dumb to do that to you because if you move, it'll be months before they fill the apartment again. That monthly rent is beyond ridiculous.
What if it's on 5th Ave? OP did not give a location. How can you make a statement like that?
I enjoy reading your posts g41, but had to comment on this one. LOL
First, I think that if the rent is over $2,500 (it may have been increased in the last couple of years but nowhere near $3,350 or $3,960) the landlord can destabilize the apt and charge whatever they want. Really, the market determines what they charge if he max authorized rent is $2,400 but the area/apt/whatever only make it worth $2,000, then they rent it for what they can obtain, rather than a higher rent that they cannot.
If the landlord has not signed the lease, then there is no enforceable lease. Legally, you most likely have no rights. Even though there was "a meeting of the minds", there is something called the Statute of Frauds, that requires contracts involving real estate to be in writing and signed by the parties being bound. An oral contract can be executed but not enforced. For example, I have a vacant lot upstate and agree to sell it to you for $100,000, on a handshake deal. We can sign the deed, pay the money, record the transaction and it will have been an executed contract. If you show up at closing with $100 large, and I change my mind, there is no deal. You cannot force me to sell it to you because it wasn't signed by me, one of the parties to be bound.
Odds are that they can tell you to take a hike if you don't sign the riders. In short, you have no legal grounds if they haven't yet signed it. If they rented to you for $3,350, they can most likely find someone else to pay that with the lease having the appropriate riders of attached.
Since you have possession, it may be considered an executed contract that can go along fine for 2 years, BUT, without a written lease you are subject to eviction with a written notice. The old "Catch 22" I am afraid.
Good luck arguing but I think you have no legal basis not to sign, unless you know and can prove that the agreement was signed by the LL, thereby binding in writing, "a party to be bound." I think notification must be made to all parties, usually by delivery of fully executed copies. If you don't have one most likely you are screwed. There was an appellate case a few years ago concerning an emailed contract, but you don't mention email. "The New York Appellate Division's (First Department) recent decision in Naldi v. Grunberg held that "an electronically memorialized and subscribed contract be given the same legal effect as a contract memorialized and subscribed on paper."
I am not a licensed attorney in New York and not able to provide legal advice. If you feel you need legal advice, you should consult an attorney.
Well you were spot on. I heard back from the management company and the lease was never countersigned.
Certainly learned a lesson on this one. Would not have imagined they would have let me move in and live here for 2.5 months without a countersigned lease. Will not be moving into any apartment in the future until I have a countersigned lease.
Hypothetically since the lease was never countersigned I could move out today. Could I recover any paid rent?
First, there is no such thing as "preferential rate".
Yes, there is a 'thing' called preferential rent. It pertains to rent stabilized apartments, which have a legal regulated rent. You can read about it on multiple sources just by going to Google.
1. I have trouble conceiving of a 2 year old building in Rent Stabilization. I imagine it COULD happen with certain tax breaks but this is not likely.
2. When an apartment with a rent over $2500 goes vacant it leaves Rent Stabilization, so how could a stabilized apartment ENTER the market with a rent so high.
3. A landlord must attach a rider to a RS lease, but there is no requirement for you to sign it, thus in some way assenting to it.
If I moved into this building, my first call would be to DHCR to file for a rent reduction...the legal rent might surprise you by a grand or two.
But ultimately, this sounds fishy enough to follow Monte Python's advice and RUN AWAY. If you really WANT to stay at $3350, be prepared to move in 2 years (likely and a pain in the ass), or else live there forever with a huge rent reduction granted by DHCR (unlikely and wonderful.)
Last edited by Kefir King; 01-16-2015 at 08:42 AM..
1. I have trouble conceiving of a 2 year old building in Rent Stabilization. I imagine it COULD happen with certain tax breaks but this is not likely.
2. When an apartment with a rent over $2500 goes vacant it leaves Rent Stabilization, so how could a stabilized apartment ENTER the market with a rent so high.
3. A landlord must attach a rider to a RS lease, but there is no requirement for you to sign it, thus in some way assenting to it.
If I moved into this building, my first call would be to DHCR to file for a rent reduction...the legal rent might surprise you by a grand or two.
But ultimately, this sounds fishy enough to follow Monte Python's advice and RUN AWAY. If you really WANT to stay at $3350, be prepared to move in 2 years (likely and a pain in the ass), or else live there forever with a huge rent reduction granted by DHCR (unlikely and wonderful.)
There was a stabilization rider attached to the original lease we signed but listed the rent at $3350.
The apartment and building are fantastic and I am admittedly getting a good deal from what I was seeing on the market in my price range when I was looking. I am just off of the city hall stop (a little research on rental building less than a year old in this area will tell you what building exactly).
It was a lease break situation that I took over the apartment from (previous tenet was having a baby and wanted more space). So my guess is that I got a good deal and all of this preferential rent stuff was supposed to be in the initial lease but it was never disclosed and someone probably screwed up, didn't include it, and now they are trying to cover their mistake.
It appears the net-net of the situation is that because the management company never countersigned the lease they can force me to sign the riders or I get the boot. And in 2 years if I want to renew they can jack my rent up 22.75% to around $4100.
It just all looks so shady given that nothing was disclosed at lease signing.
1. I have trouble conceiving of a 2 year old building in Rent Stabilization. I imagine it COULD happen with certain tax breaks but this is not likely.
2. When an apartment with a rent over $2500 goes vacant it leaves Rent Stabilization, so how could a stabilized apartment ENTER the market with a rent so high.
The rent on my new apartment is over $2,500 - Can it be stabilized?
The building may in fact be rent stabilized, even though the rent exceeds $2,500.
In newly constructed or completely rebuilt buildings, many developers take advantage of the City's 421a and J-51 tax exemption programs. In return for the tax exemption, the developer/owner of the building must maintain the units under rent stabilization for the period of the tax exemption, which usually runs 10 to 20 years. More information is available in the 421a/J-51 FAQ section. In the case of new construction, the fact that the rent is over $2,500 does not affect the apartment's stabilization status.
If the apartment is on 5th ave, I'd ask for all the same documents.
Just because the words "preferential rate" exist doesn't give it any meat or substance. That's like saying "I'm American" or "my boyfriend made me climax" when he didn't. It means nothing.
That apartment wasn't worth that price nor was it charging that in 1979, so let's stop the BS. And if you tell a management company those exact words, they'll shut their mouth real fast. I said that to a foreigner who was trying to play me with a 2 bedroom in Astoria. I asked a simple question : Is it rent stablized? It's a yes or no question and he kept beating around the bush. Then, he tries to sound all smart and educated and starts talking about jacking up the rent should the area get HOT.
When I said the 1979 line, he shut his mouth immediately and replied: You know what you are talking about. Real estate owners love to play people like a fool and pocket as much as they can. Then they invent these ridiculous "legalise" terms that mean absolutely nothing.
If its rent stablized you should he fine. If he adds in preferential rate on the lease to create the illusion you're somehow getting a deal because he's charging 3350 versus 3900 then that's his prerogative. That's in there as a dumb formality because if NYC keeps instituting 1% every year, he might get greedy happy and feel a need to take away preferential rate because those 1% increases every year isn't making his pocket fat enough. Suddenly, because there's something called "preferential rate" in your lease, it gives him a license to run a muck and start doing huge price increases. That is very low class.
My new middle income lottery lease doesn't mention preferential rate but my old red brick buildings did and im not in a red brick building anymore, So take that!!!!!!
Last edited by q41apartments; 01-16-2015 at 07:48 PM..
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