NYC’s FARE Act Goes Live on June 11: What Mobility Programs Need to Know

We shared an update last November ("Is it FARE? An Update on Broker Fees in NYC") when the FARE Act was passed by the NYC Council. 180 days later, it's about to go into full effect. This marks a turning point in rental policy for the city, set to take effect on June 11, 2025. The law would prohibit real estate agents representing landlords from charging tenants broker fees—a longstanding and often costly hurdle for NYC renters.

According to StreetEasy, the average upfront cost to secure a rental in NYC—including broker fees—is approximately $12,942, or 17% of the city’s median household income. The FARE Act is projected to reduce these upfront costs by nearly 42%, bringing the average down to $7,537.

Here's a refresher on what's about to happen, assuming that implementation is not delayed due to a court challenge. Note that the Real Estate Board of New York (REBNY) and other brokerages filed a lawsuit in December 2024 to block the law's implementation. The lawsuit claims the FARE Act violates constitutional rights, including those related to free speech and private contracts. 

What’s Changing on June 11?

If it is not delayed or overturned, the FARE Act requires that the party who hires a broker—typically the landlord or property manager—be the one to pay for that service. It also mandates that any tenant fees must be clearly disclosed in all rental listings and agreements. Tenants may still choose to hire a broker to represent them, but in that case, the tenant remains responsible for the fee. But that fee would be determined and negotiated by those two.

For corporate mobility programs, this is a material change. Many relocation packages currently include reimbursement or direct payment for broker fees, often grossed up to cover the tax impact on the employee. With this expense shifting to landlords, mobility programs may see meaningful cost savings, especially in NYC—a high-volume, high-cost destination for many relocating employees.

Will Rents Go Up?

Rent increases are a concern. History shows “no-fee” apartments tend to have slightly higher rents. However, StreetEasy data indicates that rent increases in advance of the law have remained in line with market trends, suggesting landlords are not fully passing on broker costs through higher base rent.

From January to April 2025, listings that dropped broker fees saw average rent increases of 5.3%, compared to 4.6% for listings that still charged broker fees. This is a marginal difference that suggests property managers are absorbing much of the cost, as they’ve done during past market cycles.

Then, this latest article from TimeOut, “A new rental law is going into effect on Wednesday—here's what to know” shares:

Landlords are already adjusting. According to Curbed, some are raising rents, like the Clinton Hill owner who upped a one-bedroom from $3,200 to $3,600 on June 1. Others are cutting brokers out entirely and relying on word-of-mouth to fill units. A few seem ready to do the unthinkable: Talk to prospective tenants themselves.

Brokers Still Play a Role

Despite fears of reduced demand for brokers, StreetEasy found that 56.9% of “no-fee” rentals were still represented by agents in early 2025. Rental brokers continue to provide essential services to landlords, including marketing, screening, and showings. The FARE Act simply clarifies who pays for those services and under what circumstances.

For renters, this change will hopefully reduce confusion, bring greater transparency, and make it easier to understand what they're paying for. Listings will now be required to include all tenant fees up front, giving consumers more confidence and predictability when budgeting for a move.

Some are concerned that:

1. Landlords may increase the rent to cover the cost of the commission they now must pay.
2. Unrepresented landlords, particularly independent owners, who are not familiar with the laws, may charge more than one month security and the first month’s rent.  A tenant who is also not represented will end up paying more upfront costs.
3. Things get complicated if an agent serves as a dual agent.  This is the only scenario where a tenant MAY pay a landlord’s agent’s fee (because that agent is both LL agent and tenant agent).  

A More Equitable Rental Market?

StreetEasy and Zillow have been vocal supporters of the FARE Act, calling it a step toward a more affordable and efficient housing market. By lowering barriers to entry, the law is expected to increase renter mobility, unlocking more housing inventory and improving fluidity across neighborhoods.

The FARE Act also complements other affordability efforts, including initiatives to spread out security deposits, report positive rental payments to credit bureaus, and reform zoning to expand housing supply.

What’s Next for Mobility Programs?

Relocation teams may want to review their policy language around broker fee reimbursements, and consider how they might want to revise for NYC moves taking place after June 11. But it may be challenging to make a policy decision except to clarify that the program will not reimburse any portion of landlord broker agent fees.  That alone may save some costs, and that should happen naturally even if you do not spell it out in the policy since (assuming the act goes forward) it would no longer be legal to charge the renter. Proactive communication with relocating employees will help set expectations and clarify when broker fees can and can't be charged and are or aren’t covered.

This is a major shift in how NYC’s rental market functions. For tenants, it will hopefully housing costs more affordable. For brokers, it’s a chance to recalibrate. And for mobility programs, we hope it will be an opportunity to evolve relocation support in a more efficient, cost-conscious direction.

As the market adjusts, we’ll continue to monitor how landlords, renters, and agents respond — and creatively consider policy adjustments and what that means for the cost and experience of relocation in New York City.

Also, if you're looking for more perspectives on the potential impact of the FARE Act, check out these other related articles:

What You Need To Know About the FARE Act

NYC Broker Fee Changes: What the FARE Act Means for Renters

NYC broker fee law — which protects tenants from costs — challenged by real estate agents in 11th-hour push

NYC Renters Brace for Price Hikes After Broker-Fee Ban