If you have been reading closely and thinking that one of these headlines is not like the others you would be absolutely correct. The common thread here is that the sum of these rulings should bear a positive impact on the housing provider community. Let’s take these one at a time and look at why they matter.
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1- Eviction filings so far this year in NYC have not exceeded the 50,000 mark. Though this may seem high, prior to covid in 2019, eviction filings had already exceeded 100,000 in the first six months of the year. The pandemic played a big role in keeping eviction numbers tamped down, but now – now it’s back to the wild west of 2019 BC (before covid). And by Wild West, we mean that a judge has scrapped one of the procedural hurdles that was previously required to litigate non-paying tenants. So not exactly an avalanche of change, but thanks to Judge Carolyn Walker Diallo, housing providers should see moderately quicker resolutions to legal disputes that previously dragged on endlessly. Tenant groups will likely point to this as another problem in the system that is being peppered on top of the recent development whereupon tenants are no longer guaranteed attorneys for their court appearances. On the other hand, though owners won’t feel the impact right away, this sets the stage for investors to gain confidence in buying new assets knowing that they have quicker paths to solving issues with tenants, should they arise. TL;DR, this change should contribute to more transactions.
2- Good Cause is a known concern to real estate investors everywhere in NYS and today there is a small ray of sunshine illuminating an otherwise gloomy fight. NY’s Supreme Court declared that Good Cause in Albany came in direct conflict with state laws. This is incredibly significant because Albany was the first municipality in the state of NY to pass Good Cause. To have the birthplace of said movement be overturned - and so close to the state capitol - sends a strong message to owners state-wide. It also lays down a foundation with which to counteract elected officials’ efforts to pass Good Cause at the state level (read bill here).
3- Finally, gun laws… and real estate? On its face it may seem hard to connect the dots, but let’s try and abstract a little bit. The Supreme Court of the United States got involved with a state law and overturned it because it was not adherent to the U.S. constitution. Does this sound familiar? This is the stuff that landlords in NY pray about every night. It is also the bedrock of the legal challenge that owner groups are levying at NY state and its rent stabilization laws. The claim is that 2019’s rent regulations reform (HSTPA) is so constrictive that it is tantamount to a taking of property, thus violating the U.S constitution. This ruling could lend strong support to the plaintiffs, CHIP, RSA in their suit against the court of appeals. Exciting stuff!
3 subtle changes in NY multifamily governance
3 subtle changes in NY multifamily governance
3 subtle changes in NY multifamily governance
What you may not have heard about this past week are the various legal changes and reversals that have occurred in NY multifamily real estate
Uno, Reverse!
Three things that stand out in particular:
1- A NYC judge removes a filing requirement for owners evicting tenants for non-payment
2- The NY Supreme Court reversed the passing of Good Cause Eviction in Albany
3- The US Supreme court outlawed a NYS rule that generally banned firearms outside the home
If you have been reading closely and thinking that one of these headlines is not like the others you would be absolutely correct. The common thread here is that the sum of these rulings should bear a positive impact on the housing provider community. Let’s take these one at a time and look at why they matter.
Thanks for reading Romain’s Newsletter! Subscribe for free to receive new posts and support my work.
1- Eviction filings so far this year in NYC have not exceeded the 50,000 mark. Though this may seem high, prior to covid in 2019, eviction filings had already exceeded 100,000 in the first six months of the year. The pandemic played a big role in keeping eviction numbers tamped down, but now – now it’s back to the wild west of 2019 BC (before covid). And by Wild West, we mean that a judge has scrapped one of the procedural hurdles that was previously required to litigate non-paying tenants. So not exactly an avalanche of change, but thanks to Judge Carolyn Walker Diallo, housing providers should see moderately quicker resolutions to legal disputes that previously dragged on endlessly. Tenant groups will likely point to this as another problem in the system that is being peppered on top of the recent development whereupon tenants are no longer guaranteed attorneys for their court appearances. On the other hand, though owners won’t feel the impact right away, this sets the stage for investors to gain confidence in buying new assets knowing that they have quicker paths to solving issues with tenants, should they arise. TL;DR, this change should contribute to more transactions.
2- Good Cause is a known concern to real estate investors everywhere in NYS and today there is a small ray of sunshine illuminating an otherwise gloomy fight. NY’s Supreme Court declared that Good Cause in Albany came in direct conflict with state laws. This is incredibly significant because Albany was the first municipality in the state of NY to pass Good Cause. To have the birthplace of said movement be overturned - and so close to the state capitol - sends a strong message to owners state-wide. It also lays down a foundation with which to counteract elected officials’ efforts to pass Good Cause at the state level (read bill here).
3- Finally, gun laws… and real estate? On its face it may seem hard to connect the dots, but let’s try and abstract a little bit. The Supreme Court of the United States got involved with a state law and overturned it because it was not adherent to the U.S. constitution. Does this sound familiar? This is the stuff that landlords in NY pray about every night. It is also the bedrock of the legal challenge that owner groups are levying at NY state and its rent stabilization laws. The claim is that 2019’s rent regulations reform (HSTPA) is so constrictive that it is tantamount to a taking of property, thus violating the U.S constitution. This ruling could lend strong support to the plaintiffs, CHIP, RSA in their suit against the court of appeals. Exciting stuff!
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Sources: Law360 NY, ScotusBlog, The Real Deal, Spectrum Local News
Originally posted on July 17th, 2022