The New York Times
Real Estate Q&A (2nd half)
229 W. 43rd St.
New York, NY 10036
September 17, 1995
Q.: What is the difference between rent control and rent stabilization?
Jerald Seif, YonkersA.: The differences are best illustrated by describing when and how each is applied.
According to an information fact sheet provided by the New York State Division of Housing and Community Renewal (DHCR), rent control applies to residential buildings constructed before February 1, 1947 in municipalities that have not yet declared an end to the postwar rental housing emergency. New York City, Albany and Buffalo are three of 51 such municipalities.
For an apartment to be under rent control, the tenant must have been living there continuously since before July 1, 1971. When a tenant moves from a rent-controlled apartment, the apartment usually becomes rent-stabilized.
Rent control limits the rent an owner may charge for an apartment and places restrictions on the right of an owner to evict a tenant. In New York City the Division of Housing and Community Renewal (DHCR) sets the Maximum Base Rent (MBR) for each apartment and then adjusts that amount every two years to reflect changes in operating costs. Subject to challenges by tenants, owners who certify that they are providing essential services and have no existing violations in their buildings can usually raise rents by 7.5 percent each year, until they reach the Maximum Base Rent (MBR).
Rent stabilization, on the other hand, generally applies to apartments in buildings of 6 or more units built between February 1, 1947 and January 1, 1974, and to tenants who moved into rent-controlled apartments after June 30, 1971. Also covered under rent stabilization are apartments apartments in buildings that have 3 or more units that have been constructed or extensively renovated since 1974 with special tax benefits.
Like rent control, rent stabilization provides protection against eviction to tenants and gives tenants the right to essential services. Moreover, it gives the tenant the option to renew his or her lease for either a one- or two-year term. In New York City the local Rent Guidelines Board (RGB) sets maximum rates for rent increases once a year. Such increases are effective for leases beginning on or after October 1 of each year.
Under both rent control and rent stabilization other increases are sometimes allowed for Major Capital Improvements (MCI), hardship, increased labor costs and fuel passalongs.