Photo Courtesy of Comptroller Stringer’s Office
“We know that one major reason people can’t afford to live in New York City is out of control and completely unregulated security deposits,” Comptroller Stringer (c.) said.
By Forum Staff
City and State legislators recently introduced bills aimed at reforming unregulated security deposits.
New Yorkers spent approximately $507 million on security deposits in 2016, according to City Comptroller Scott Stringer. The legislative packages, which were unveiled in the City Council and State Legislature last week, address gaps in City and State law that enable landlords to hike upfront rent costs at extreme levels, Stringer noted.
“New York can’t wait any longer to start solving our exploding housing and homelessness crisis. We know that one major reason people can’t afford to live in New York City is out of control and completely unregulated security deposits. That’s money that can’t be used to support a family, pay for an education, medical expenses or be set aside for an emergency,” the comptroller added. “It’s preposterous that a landlord can demand many months’ rent from a tenant and there’s little recourse if they just decide to keep it. Today, we’re moving one step close to making sure no one needs to choose between renting a home and putting food on the table.”
Bills introduced in Albany will:
• Limit security-deposits to one month’s rent for residential leases of at least one year
• Allow renters to pay security deposits in six or fewer installments instead of one lump sum
• Establish a security deposit protection program to be administered by the commissioner of Housing and Community Renewal. Security deposits would be held by a third-party custodian who would be responsible for the return of security deposits as well as any dispute resolution
• Require landlords to return security deposits within 21 days after the lease expires
Bills introduced in the council will:
• Limit security deposits to one month’s rent
• Give renters the option of paying security deposits in installments
• Require that security deposits on rental apartments be returned to the tenant within 60 days of the end of the lease
Stringer also noted that the above measures were released in tandem with a survey of New Yorkers about their personal experiences with security deposits. It asks New Yorkers about the burden of security deposits and gauges their interest in new, fairer options for paying security deposits. Survey results will help guide future action on making renting an apartment in the city more affordable, the comptroller added.
“There are significant costs associated with finding a new apartment in New York City, one of which is security deposits,” said City Councilman Keith Powers (D-Manhattan), who sponsored all three NYC bills. “While security deposits are typically set at one month’s rent, low-wage tenants who may be considered ‘high risk’ can be charged a security deposit two or three times that amount. With this legislation in the City Council, a one-month cap will set expectations and make these fees predictable. New Yorkers will not only be able to make more informed housing decisions, but tenants—particularly young and low-income tenants—will not have to pay thousands and thousands of dollars to build a home here.”
