DHCR Issues Updated Renewal Lease Form
The DHCR recently updated NYC Renewal Lease Form (RTP-8) to incorporate the requirements of Rent Guidelines Board Order (RGBO) #55. The RGBO applies to renewal leases for rent-stabilized apartments, beginning anytime on or after Oct. 1, 2023, through Sept. 30, 2024.
According to RGBO #55, you may take a 3 percent increase on a one-year renewal lease. On two-year renewal leases you can raise rents by 2.75 percent for the first year and, for the second year, 3.2 percent of the amount lawfully charged in the first year, excluding any increases other than the first-year guideline increase.
The last time the Rent Guidelines Board (RGB) issued two different rent increase percentages to a two-year renewal lease was in 2020 with RGBO #52. At the time, in the midst of the pandemic, RGB froze one-year renewal rents and set a partial freeze for two-year renewals at 0 percent on the first year of a two-year lease and 1 percent for the second year of a two-year lease.
As the most recent DHCR Renewal Lease Form, this updated form should be used for all renewal leases going forward. You can find the form at https://hcr.ny.gov/system/files/documents/2023/06/rtp-8-06-2023-fillable.pdf.
Lease Renewal Process
Generally, tenants in rent-stabilized apartments must be offered renewal leases. The renewal lease can be for a term of one or two years, at the tenant’s choice, and is at a rate set by the Rent Guidelines Board. The renewal lease offer must be made on a form created by or on a facsimile approved by the DHCR.
How and when to deliver. In New York City, the owner must give at least two copies of the completed renewal lease form by electronic means, mail, or personal delivery not more than 150 days and not less than 90 days before the existing lease expires on a DHCR Renewal Lease Form (RTP-8).
If the owner offers a renewal lease less than 90 days before the expiration of the existing lease, the lease term selected by the tenant will begin at the tenant’s option, either on the date a renewal lease would have begun had a timely offer been made or on the first rent payment date occurring no less than 90 days after the date that the owner does offer the lease to the tenant.
Completing PART A. On the form, the owner must fully complete PART A, which explains how the new rent has been computed. We’ve provided a sample RTP-8 form (see the August issue PDF, p. 7) illustrating how an owner might fill out the form. Assuming a legal rent of $1,000 on Sept. 30 preceding the commencement date of a renewal lease, the sample form shows a guideline increase of $30 for a one-year lease renewal and increases of $27.50 for the first year and $32.88 for the second year on a two-year renewal lease. Therefore, the new legal rent for the sample apartment should the tenant choose a two-year lease renewal would be $1,027.50 for the first year and $1,060.38 for the second year.
Tenant’s timeline. After the renewal offer is made, the tenant has 60 days to choose a lease term, sign the lease, and return it to the owner. If the tenant doesn’t accept the renewal lease offer within this 60-day period, the owner may refuse to renew the lease and, if the tenant hasn’t moved out after the expiration of the current lease, may also proceed in court to have the tenant evicted.
Returning fully executed lease. When a tenant signs the renewal lease form and returns it to the owner, the owner must return the fully signed and dated copy to the tenant within 30 days. If an owner doesn’t return a copy of the fully executed renewal lease form to the tenant within 30 days of receiving the signed lease from the tenant, the tenant should still pay the new rent but can file a complaint form for failure to furnish a copy of a signed lease with the DHCR.
A renewal should go into effect on or after the date that it’s signed and returned to the tenant but no earlier than the expiration date of the current lease. In general, the lease and any rent increase may not begin retroactively.
Renewal leases must keep the same terms and conditions as the expiring lease unless a change is necessary to comply with a specific law or regulation. Also, when a tenant receives the Lease Renewal Form, a copy of the New York City Lease Rider For Rent Stabilized Tenants must be attached. The rider explains how the proposed rent was computed and describes the rights and obligations of tenants and owners under the Rent Stabilization Law.
Reasons for Not Renewing a Lease
An owner can refuse to renew a lease for several reasons, some of which are:
- The owner or a member of the owner’s immediate family needs the apartment for their personal use and primary residence. If the tenant is a senior citizen or disabled, special rules apply;
- The apartment is not used as the tenant’s primary residence;
- The owner wants to take the apartment off the rental market, either to demolish the building for reconstruction or use it for other purposes permitted by law.
When the owner doesn’t offer the tenant a renewal lease for one of these reasons, however, the owner must give the tenant written notice of nonrenewal during the lease-offering time frame described above. Failure to serve this notice on the tenant during this time frame will entitle the tenant to a renewal lease.
Applying RGB Increases to Preferential Rents
A preferential rent is a rent that an owner agrees to charge that’s lower than the legal regulated rent that the owner could lawfully collect. As a result of the Housing Stability & Tenant Protection Act (HSTPA), there are restrictions to preferential rent adjustments. Tenants who were paying a preferential rent as of June 14, 2019, retain the preferential rent for the life of the tenancy.
Owners who are collecting a preferential rent, upon renewal of the lease, can increase the legal and preferential rents by the lawful rate increases (such as Rent Guidelines Board increases and other increases allowed by the Rent Stabilization Law), but only collect an increase based on the preferential rent. The higher legal regulated rent and related increases can be collected only when the apartment is vacated and rented to a subsequent tenant.
Get Voluntary Consent, Proof of Service
When Sending Electronic Renewal Lease Offers
The DHCR permits rent-stabilized leases and lease renewals to be offered and accepted through electronic means [Operational Bulletin 2022-1, “Electronic Lease Offering and Tenant’s Voluntary Consent”].
Obtain consent. To be able to offer rent-stabilized lease agreements by email, you must obtain the tenant’s voluntary consent. DHCR Form EL-TVC entitled, “Electronic Lease Offer: Tenant’s Voluntary Consent Form,” is the standard form to obtain consent. You can find the form here:
The consent form must be signed by both parties and a copy must be provided to the tenant. You should also keep a copy of all documents for your records because the consent form isn’t required to be sent to the DHCR’s Office of Rent Administration.
The operational bulletin allows for service of the consent form either prior to or at the same time as the lease or renewal lease offer. But the instructions included with the consent form say that consent must be obtained “prior to the use of electronic records to execute a lease or renewal form.” As a result, to be on the safe side, you should obtain consent “prior to” sending the lease or renewal lease offer. Without a signed consent form from the tenant, an owner can’t offer leases electronically, nor can an owner require electronic signatures.
Also, other than spouses or domestic partners, all tenants must sign the consent form in order for the consent to be effective. Once signed, the consent is applicable for the entirety of the tenancy, to all subsequent lease renewal offers during the tenant’s time in the rent-stabilized apartment.
Maintain proof of service. Being able to offer a rent-stabilized renewal lease by electronic means requires owners and tenants to maintain proof of service of the consent form, the lease renewal offer, and the acceptance or refusal. According to the DHCR, regardless of whether the transmission was done by personal email, electronic portal, or some other alternative, proof of service should include, but not be limited to, as many of the following elements as possible:
- Identity of the sender and recipient;
- Date of transmission;
- Subject matter;
- Attachments; and/or
- Electronic links to documents.
Regardless of the method of service used, owners must be able to print copies of electronic communications and all documents for submission to the DHCR and/or the courts upon request in a case proceeding. Remember that all of the regular window periods for lease renewal offers and tenant responses still apply. In New York City, an owner must give written notice of renewal by mail or personal delivery not more than 150 days and not less than 90 days before the existing lease expires on form RTP-8. After the renewal offer is made, the tenant has 60 days to choose a lease term, sign the lease, and return it to the owner.
HSTPA Requirements for Non-Rent-Regulated Lease Renewals
For unregulated apartments, the Housing Stability and Tenant Protection Act of 2019 (HSTPA) imposes certain requirements on owners seeking to raise rents. For example, advance notice is required to raise the rent for these apartments.
For unregulated apartments, the landlord does not have to renew the lease. However, a lease may contain an automatic renewal clause. In such cases, the landlord must give the tenant advanced notice of the existence of this clause between 15 and 30 days before the tenant is required to notify the landlord of an intention not to renew the lease [General Obligations Law §5-905].
Written notice. If you, as the landlord of the non-regulated unit, intend to renew the lease with a rent increase of more than 5 percent, or does not intend to renew the lease, they must provide advanced written notice:
- If non-regulated tenant has lived in your apartment two or more years, or if non-regulated tenant has a two-year lease, you must provide tenant with 90 days’ advanced written notice before raising rent or not renewing your lease;
- If non-regulated tenant has lived in the apartment for more than one year, but less than two years, you must provide tenant with 60 days’ advanced notice before raising rent or not renewing tenant’s lease; or
- If non-regulated tenant has lived in the apartment for less than one year, or has a lease for less than one year, you must provide tenant with 30 days' advanced notice before raising rent or not renewing the lease [Real Property Law §226-c].