Small Landlords for Rent Stabilized Multi-Family (Queens, NY)

[Dennis D.]

I'm seeing more 6-family rent stabilized homes for sale now in Queens, NY.

Based on my research, most people suggest staying away from these properties (e.g. More regulations, tougher to evict non-paying tenants, etc.). One landlord even suggested that a mortgage-free 6-familly still isn't worth it here!

I'm curious if there is anyone here that can share any success on making these properties work? How did you do it?

[Lydia Winn]

Hi Dennis,

There are a lot of broad generalizations about “6-family rent stabilized = bad investment,” but the reality is more nuanced. Rent stabilization is not one uniform situation—there are multiple layers that materially change the economics and the exit strategy.

For example, one of the biggest distinctions is tenant profile. If a tenant is over a certain age and paying a high percentage of income toward rent, you may not be able to recover that unit even for owner-occupancy. In contrast, units occupied by younger, higher-income tenants who are already paying near-market legal rents have a different trajectory. Same building type, completely different expected outcomes.

The political environment matters too. The new mayor signaling a potential rent freeze is pushing a lot of small owners to sell. That is creating a buyer’s market—but only for buyers who underwrite like they’re buying a bond, not a value-add play. The days of banking on vacancy-based resets or buyouts as your core strategy are gone.

The deals that still “pencil” tend to look like this:

• You underwrite long-term stable yield, not big upside.

• You assume minimal rent increases (or none).

• You price in legal/operational friction.

• You negotiate hard because sellers are fatigued and there are fewer buyers willing to take these on now.

• You diligence each tenant’s regulatory profile—not just lease terms, but age, household makeup, income certifications, and historical registrations.

If you go into this expecting returns of 10%+, it will look terrible. If you go into it expecting something closer to bond-like yield with tax benefits and long-term optionality, there are deals that make sense.

The key is that not all rent-stabilized buildings are the same, and the spread in outcomes is wide. The people who struggle are the ones who assume they’ll “figure out” the tenants later. The people who do fine are the ones who treat tenant review and DHCR history as the underwriting.