NYC Broker Fees, Explained: What Relocating Employees Need to Know Before They Sign

If you have transferees heading to New York City, there's a good chance they've already heard something about "no more broker fees" — and a good chance what they heard is only half right. The Fairness in Apartment Rental Expenses (FARE) Act changed who pays broker fees in NYC and not whether brokers are useful. For mobility teams, that distinction matters: get it wrong in a policy communication and you'll either overpromise savings or send a transferee into a lease negotiation without the help they actually need.

What Actually Changed

The FARE Act (Local Law 119 of 2024) took effect June 11, 2025. In short: a landlord's agent and anyone who lists an apartment with the landlord's permission can no longer charge a fee to the prospective tenant. That fee obligation now sits with whoever hired the broker: the landlord.

A few things the law does not do:

• It doesn't ban broker fees outright. It just prohibits landlords from passing their broker's fee on to the tenant.
• It doesn't stop a tenant from hiring their own broker and paying that broker directly, if they choose to.
• It doesn't prohibit landlords from charging for background or credit checks.
• It doesn't eliminate security deposits, which remain capped at one month's rent.

Landlords are also now required to itemize and disclose, in writing, every fee a tenant will owe before that tenant signs anything. They also have to keep the signed disclosure on file for three years.

When Is a Broker Necessary vs. Optional?

This is the part transferees actually need help thinking through, and it's a good talking point for consultants and mobility managers alike:

A broker is not required to:

• View or apply for a listing agent's apartment. No one, including a dual agent, can condition access to a unit on the renter hiring a broker.
• Rent directly from a landlord who self-manages or lists without an agent (increasingly common post-FARE Act, and worth flagging to renters browsing no-fee inventory).

A broker can still be worth hiring, at the tenant's own expense, when:

• The employee is relocating from outside NYC (or internationally) and doesn't know the neighborhood landscape, building quality, or realistic pricing.
• Timeline pressure is high, since a broker with market access can often move faster than a self-directed search, especially in a competitive submarket.
• The employee needs help navigating board approvals, co-op/condo paperwork, or guarantor requirements, which remain complex regardless of who's paying the listing fee.
• English isn't the employee's first language or they're unfamiliar with US rental documentation (credit checks, income verification multiples, guarantor thresholds).

Many people, especially those arriving from overseas or from less regulated markets, want guidance through the web of NYC rental rules. Skipping a broker saves money but may cost precious time, or worse, can lead to mistakes. The tradeoff is straightforward: pre-FARE Act, the broker often felt "free" because the landlord's fee was baked into what the tenant paid. Now that separation is explicit, so it's a real cost-benefit decision rather than a default step in the process.

What to budget. The FARE Act shifts who pays a broker fee, but it doesn't cap how much one can cost — that's still negotiated between the tenant and the broker they hire. Market norms that applied under the old system are still the best benchmark: typically one month's rent to around 15% of annual rent, with reports of fees running higher in competitive or rent-stabilized situations. On a $3,500/month apartment, 15% of annual rent works out to roughly $6,300. For mobility programs, this means a self-directed transferee who opts to hire a broker should be budgeting in that same range as a voluntary, disclosed cost — not assuming it's gone entirely just because the landlord can no longer pass it on.

What This Means for Mobility Programs

A few practical takeaways worth building into NYC-bound policy:

1. Update any policy language or FAQ that references broker fees as a landlord-side or "unavoidable" cost. If your program has historically included broker fee guidance or reimbursement caps for NYC, that language may now be moot for landlord-side fees, though could still be relevant if an employee opts to hire their own broker.
2. Flag the disclosure requirement as a tenant protection, not a red flag. Employees should expect (and should ask for, if they don't receive it) an itemized, signed fee disclosure before signing a lease.
3. Set expectations on "no-fee" listings. No-fee doesn't always mean no broker, it can mean the landlord is absorbing the fee. Encourage employees to ask directly.
4. Remind international and first-time NYC renters that self-directed searching is more viable now, but that a paid broker still has a legitimate role for anyone unfamiliar with the market or under time pressure.
5. Most companies cover the broker fee in policy: In our experience, approximately 7 in 10 companies moving employees into NYC offer support with the broker fee within their relocation policy. Coverage limits depend heavily on your corporate tier, job level, and whether the move is temporary or permanent.