NY & the new Landlord/Tenant Laws

[Michael Ablan]

Hey guys, So on June 14th, a new wave of tenant friendly laws were passed in NY.  My attorney is still reviewing everything, but has given me the following bullet points

• The old 3 day non payment demand for rent is now changed to 14 days
• A tenant can automatically ask for a 14 day adjournment at court and have it granted
• Once a warrant has been issued, it cannot be enforced for 14 days (changed from 72 hours).
• A tenant can request a hardship and be granted up to 1 year to remain in the unit
• Late fees are capped at $50 or 5% of the rent (whichever is higher).  The landlord must give the tenant a 5 day grace period, and must send a certified letter before they can begin charging rent.
• Landlords are no longer allowed to charge application fees.  They may charge up to $20 or background/credit screenings 
• Landlords may no longer deny tenants based on prior evictions or other landlord/tenant disputes
• Month to month tenacy must be terminated in writing as follows
  • 30 days if tenancy has been less than 1 year
  • 60 days if tenancy has been more than 1 year, but less than 2 years
  • 90 days if tenancy has been more than 2 years
• Court dates must be scheduled 10 days out from the notice of petition, rather than 5 days
• If you are evicted for breaking the lease rules, the court must give you 30 days to delay the eviction for you to fix the problem

This is just a handful of the changes.  Some of these are an absolute disaster, especially in regards to how many opportunities a tenant is given to delay the eviction proceeding.  Essentially they're being given an extra 1-2 months to live in the unit for free.

I'm super careful with my screening and placement, but I always seem to have issues with inherited tenants. I now have to assume I'm going to be stuck with these leeches for 2-3+ months. That doesn't even factor in the possibility of them getting granted hardship, which can allow them to stay in he unit for 1 full year rent FREE. That would absolutely sink the investment in the SFH landscape.

I guess I'm looking to hear from other landlords who operate in super tenant friendly states.  Do you avoid class D & C investments completely?  Do you budget in higher operating costs when doing due diligence?  When you buy properties, do you demand the tenants be removed before closing?

A part of me wants to flip this state the finger and head south, while the other part see's an opportunity to pick up deals from investors who can't/won't change to the new landscape.

Thoughts?