Subletting a rent stabilized apt for higher amount than actual rent legal?

6 Replies

I applied for a rent stabilized apartment a got approved. The rent is $700/month for 2/1 apartment in a new constructing high rise. Is it legal to sublease the apartment for a higher amount than the actual rent price? Market rent is about $1500/month. Assuming I let the landlord know about the sublet but don't include the amount the new renter will be paying to me.

 Can this be done? 

1.  You can't charge more than the stabilized rent;

2.  You are required to provide the landlord the sub-lease;

3.  The landlord can and will charge you a sublet fee;

4.  You are only entitled to the apartment if it is your primary residence;

5.   This type of crap is exactly why rent stabilization is a bad idea.

@Ricardo S.  Do you know how many people in NYC would give anything to be in your position to have a rent stabilized apartment. if you need the apt then take it and be happy you got it.

If not tell the landlord you don't need it and let the next person in line who truly needs it have it. These apartments are required by the city for a reason to help people with rising rents. not for investors to make money off of them.

Not to mention what you are trying to do is probably illegal in NYC.

I'm not a lawyer and this is not legal advice, but I can tell you it is not allowed. If you are going to be doing it by the book, the landlord will have to know how much you are charging, and I'm almost positive that you are not allowed to make a profit from subletting a rent stabilized unit. 

That said, plenty of people illegally sublet in NYC and if you are fine with knowlingly breaking the law then you may get away with it (assuming you have a quiet doorman and neighbors). If the landlord finds out you are illegally subletting you will almost definitely be evicted (and you subtenant) and may get sued as well.

If you were letting a room (as in taking on a roommate, but still actually living there) then that is typically looked upon differently. The landlord can't really dictate what the agreement between two roommates is. But even having a roommate that isn't on the lease is something that can get complicated, especially if you have a relative or spouse living with you. NY has a "roommate law" that, in part, dictates what you are and are not entitled to do.

Bottom line, subletting a regulated apartment in the city is not legal, and more importantly not ethical. It is also not real estate investing.

I did a little more hunting about this. Check out this link:

http://www.nyshcr.org/Rent/FactSheets/orafac7.htm

You cannot charge more than what your rent is, unless the unit is furnished and then you can charge 10% more. But if you don't actually maintain the unit as a primary residence then the subtenant can assume your lease.

I say just be grateful you are fortunate enough to have gotten a stabilized unit in a new building and live there yourself. It's incredibly lucky to get the opportunity.

Originally posted by @Ricardo Sandro:

I applied for a rent stabilized apartment a got approved. The rent is $700/month for 2/1 apartment in a new constructing high rise. Is it legal to sublease the apartment for a higher amount than the actual rent price? Market rent is about $1500/month. Assuming I let the landlord know about the sublet but don't include the amount the new renter will be paying to me.

 Can this be done? 

 Just out of curiosity, is $700 the legal stabilized rent or the preferential rent? I lived in a stabilized apartment for 5 years and my rent was $1250, although it was considered a "preferred" rate and my legally allowed rate was almost $1900 (the apt was worth around $2200 at market.)  When I moved out, they upped the rent to the full $1900, so if you plan on making enemies with your landlord and you have a preferential rate, that's something to consider.

@Matt Payne  @Tina Caroll  

Thanks for the help Matt. Ill just use this as a opportunity to save up for a multi family in Queens where I can rent one unit and live in the other.

Tina, I'm not sure. There was an ad in the AM Newspaper (they give it out for free in NYC) then I applied and got it. Thats what they are charging me for a 2yr lease for a 2bedroom.

Best Regards and thanks for all the information.