Proffy News #1 | State of Real Estate in NYC in 2025-2026

In this issue, we focus on the latest regulations and trends impacting the work of real estate agents, advisors, and other professionals in New York City in 2025-2026.

FARE ACT: FEE SHIFT

Effective June 11, 2025

Landlords/agents who hire brokers pay the fee — not tenants.

• 1,100+ complaints filed, only 3 settlements.

• Renters save upfront costs; 

• Landlords may pass costs via rent.

SOURCE: NYC.GOV

BUYER AGREEMENTS REQUIRED

Effective January 13, 2025

A written buyer agreement is mandatory before touring any MLS-listed home.

• Compensation is negotiable, no longer posted on MLS. 

• Agents must disclose payment terms and services clearly.

SOURCE: REBNY & NAR Settlement

GOOD CAUSE EVICTION

In Effect April 20, 2024

Rent hikes above 5%+CPI or 10% (whichever is lower) are presumptively unreasonable.

• Landlords need 'good cause' to evict. 

• Mandatory in NYC; other localities opt-in.

  
  

SOURCE: NYS HCR & NYC HPD

RENT-STABILIZED INCREASES

Oct 2025–Sept 2026

1-year renewals: +3.0%. 

2-year renewals: +4.5%. 

Applies to leases starting Oct 1, 2025 through Sept 30, 2026.

SOURCE: NYC Rent Guidelines Board

LOCAL LAW 97: PENALTIES

First Reports Due May 1, 2025

5,300+ buildings filed GHG reports for 2024. Fines at $268 per metric ton over cap.

• Good-faith pathways can reduce penalties. 

• 40% emissions reduction by 2030 required.

SOURCE: NYC DOB & Urban Green Council

ALL-ELECTRIC NEW BUILDS

Local Law 154

Buildings ≤7 stories: all-electric since Jan 1, 2024 (limited hot water exceptions until 2027).

• All new buildings: all-electric by Dec 31, 2027.

• No new gas piping.

SOURCE: NYC DOB & NYC Accelerator

CITY OF YES HOUSING

Passed December 5, 2024

Reduces/eliminates parking mandates, enables ADUs, easier conversions.

Universal Affordability Preference unlocks more FAR with affordable units.

SOURCE: NYC Council & DCP

485-x (ANNY) TAX EXEMPTION

New-Build Incentive

For new construction ≥6 units commenced after June 15, 2022 and by June 15, 2034.

• HPD rules effective Jan 15, 2025. 

• Long-term exemptions tied to affordability + wages.

SOURCE: NYC HPDP

467-m (AHCC) CONVERSIONS

Office-to-Residential Tax Breaks

Tax exemptions for commercial-to-residential conversions with affordability requirements.

• Work: Dec 31, 2022–June 30, 2031. 

• Benefits: 25-35 years post-conversion.

SOURCE: NYC HPDP

421-a EXTENDED DEADLINE

Vested Projects Only

Completion deadline extended to June 15, 2031 (from 2026) if LOI filed by Sept 12, 2024.

Helps restart stalled sites, thousands of units projected.

SOURCE: NYC HPDP

SHORT-TERM RENTAL CRACKDOWN

Local Law 18 Enforcement

STRs must be registered; platforms verify before bookings.

• 20k+ illegal listings removed. 

• Gradual rise in legal registrations. 

• Add STR clauses to leases.

  
  

SOURCE: NYC HPDP

LEAD PAINT XRF TESTING

Deadline: August 9, 2025

Pre-1960 (and some 1960-78) multiple dwellings must complete unit-by-unit XRF testing by Aug 9, 2025.

• Keep records, correct hazards. 

• Violations = penalties.

SOURCE: NYC HPD LL31

MANDATORY COMPOSTING

Fines Began April 1, 2025

Citywide organics separation required for all residential buildings.

• DSNY issuing fines since April 1, 2025. 

• Buildings must provide bins and train residents.

SOURCE: NYC DSNY

CONGESTION PRICING LIVE

Since January 5, 2025

Tolling in Manhattan CBD (below 60th St) active.

• Most cars charged once daily when entering. 

• Rates vary by time.

• Lawsuits continue but tolling remains.

SOURCE: MTA & RPA

FAIR CHANCE FOR HOUSING

Effective January 1, 2025

Can't advertise or screen based on most criminal history.

Background checks only after conditional approval, limited to 'reviewable' convictions with strict notice/appeal.

SOURCE: NYC Commission on Human Rights

OFFICE MARKET BOOM

23.2M Sq Ft Leased

Manhattan office leasing hit 23.2M sq ft in first 9 months—highest in 19 years.

• Financial sector driving demand, rents rising.

• Premium spaces outperform commodity.

SOURCE: The Real Deal

99-UNIT BUILDING CAP TREND

Avoiding 485-x Wage Rules

Developers limit to 99 units to dodge $40+/hr wage rules for 100+ units.

28 permits filed past year— more than prior 16 years combined.

SOURCE: Industry Analysis

FED RATE CUTS EXPECTED

Mid-6% Range by Year-End

Two more Fed cuts expected by year-end.

•  Rates in mid-6%. 

• Could ease financing, boost sub-$4M sales.

• Watch for stagflation risks.

SOURCE: Industry Analysis

MULTIFAMILY TRANSACTIONS UP

Cap Rates 5.5-6%

Trade volume rose in 2024. Distressed sales possible as loans mature. 

• Rents up 1.7%, vacancies low at 2.8%. 

• Strong rental demand.

SOURCE: Market Reports

SOCIAL MEDIA DRIVES DEALS

TikTok & Instagram Impact

Clients send reels/screenshots to agents. Agents with 10K+ followers close faster.

Easier inspiration but beware privacy risks and misleading posts.

SOURCE: Inman News

LUXURY MARKET SURGE

29 Contracts at $4M+ in One Week

Q3: 29 luxury contracts ($4M+) signed in one week. Upper East Side leads.

• Compass merger creates 340K+ agent network.

• Renewed buyer energy.

SOURCE: Olshan Report

CO-OP COMEBACK

26% Cheaper Than Condos

Rising interest in co-ops as affordable alternative.

New co-op listings down = seller's market for this segment.

SOURCE: StreetEasy

BROOKLYN & QUEENS RISING

May Surpass Manhattan Rentals

Combined rental market may overtake Manhattan.

New developments driving growth beyond traditional Manhattan focus.

SOURCE: The Real Deal

FALL 2025: INVENTORY UP

Post-Labor Day Surge

Listings surge post-Labor Day. Demand uncertain in sub-$4M.

• Luxury strong with cash buyers. 

• Potential price cuts but act before holidays.

SOURCE: Market Analysis