What is the Difference Between Rent Control and Rent Stabilization

During World War II many largely populated cities such as New York, Los Angeles and Chicago adopted rent stabilization and rent control laws to fortify and protect affordable housing. Rent control laws came into effect as early as 1919 stemming from the result of public outrage towards individuals and organizations taking advantage of the economic vulnerability of renters.

Since then many cities have reversed such laws due to changing class and income levels. New York City, however, still maintains rent stabilization and rent control although it seems to be fading quickly as more and more landlords are converting their buildings to more profitable condominium and co-op structures.

Rent Stabilization

Rent stabilization is a minimal percentage increase on the yearly rent of a tenant as well as the right for them to renew their lease. A landlord cannot increase the rent outside of these percentages which are set by the city Rent Guidelines Board. Between February 1st, 1947 and January 1st, 1974 any apartment buildings of six or more units built during this time became eligible for rent stabilization.

In New York rent increase percentages have been amended to apply only to those individuals whose rent is under $2,000 per month or whose total family income does not exceed $175,000 a year for two consecutive years. If a renter’s rent or income does not comply with one of these amendments then their minimal percentage rent increase is null and void and can be adjusted at the discretion of the landlord. In New York City there are about one million rent stabilization units. These numbers continue to decrease given the strong legal efforts by landlords to expose corrupt tenants trying to maintain rent stabilization despite their ineligible status.

Rent Control

Rent control limits the amount a landlord can rent or increase a tenant’s current rent. It applies to a successive family of renters continuously living in an apartment starting, in New York, anytime before July 1st, 1971. Successive family members must be a spouse, child or adult lifetime partner and their immediate successive lineage.

It does not apply to nieces, nephews, cousins or any other extended members sometimes even excluding step family. Most residential buildings built before 1947 can be rent controlled if the city still adheres to the World War II housing emergency crisis. Rent control applies only to a primary residence. So, for example, if someone lives in a rent controlled apartment and then moves to a house in the suburbs they must give up their apartment because it will no longer be their primary residence.

In addition, the law does allow a landlord to increase the rent if living improvements are implemented such as major new appliances, air conditioning, heating, structural change and so on. Currently New York City and some outlying communities in New York State have about 50,000 rent controlled units combined. It is very rare to live in a rent controlled apartment as some people pay a fraction of what their neighbors pay. Rent control is in effect in about forty countries and the rules vary by country and community. Contacting your City Rent Guidelines Board will give you information on the local rent control and rent stabilization law.