Buying out stabilized renters in NYC

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Buying out stabilized renters in NYC

Stephen Macknik
Member since 2021 · 29 posts · 24 votes

I'm interested big buying a partially vacant stabilized 6-unit building in Manhattan. How much are rent-controlled renters generally accepting as buyouts to vacate the apartments these days?

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Roi Azoulay
Real Estate Agent · New York, NY · Member since 2019 · 55 posts · 28 votes
10mo

Hi Stephen,
It is getting a bit more complicated these days - the Housing Stability and Tenant Protection Act of 2019 removed many incentives for buy-outs, but sometimes being creative with the solution is worth checking out in addition to buyouts. I had the good fortune to deal in two 2-unit buyouts in a multifamily building in Brooklyn in 2016, and had one that didn't work (SRO Building in Harlem). It really depends on what the upside of your project is, and then evaluate the risk with the tenants. 

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  • Abel CurielBusiness Member
    Real Estate Agent · Queens, NY · Member since 2016 · 2k+ posts · 1k+ votes
    11mo
    Quote from @Stephen Macknik:

    I'm interested big buying a partially vacant stabilized 6-unit building in Manhattan. How much are rent-controlled renters generally accepting as buyouts to vacate the apartments these days?


     Great question.

    This will depend on where in Manhattan AND how long the tenants have lived in the unit.

    I've heard of buyouts as low as $15-20K and as high as well above 6-figures.

    To put things in perspective, I had a friend who's parents were allegedly offered $200K+ to vacate a 2-bedroom apartment in LES BACK IN 2006/2007!

    Curious to hear if anyone else on BP can weigh in on what they're seeing in NYC. 

    I'd also recommend using the search feature to find past forum posts about the topic.

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  • Lydia Winn
    Member since 2025 · 91 posts · 55 votes
    11mo

    @Stephen Macknik 

    Just my anecdotal advice--some people will never voluntarily move. Especially if it's rent controlled, and not stabilized: Rent controlled units are so rare they function like assets unto themselves. Rent controlled units are often less than $1000 dollars/month. If it's at all possible, I might gauge the existing tenant's interest in moving/cash for keys. The other key question: How far below market rent are they currently paying? How long have they lived there? 

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  • Roi Azoulay
    Real Estate Agent · New York, NY · Member since 2019 · 55 posts · 28 votes
    10mo

    Hi Stephen,
    It is getting a bit more complicated these days - the Housing Stability and Tenant Protection Act of 2019 removed many incentives for buy-outs, but sometimes being creative with the solution is worth checking out in addition to buyouts. I had the good fortune to deal in two 2-unit buyouts in a multifamily building in Brooklyn in 2016, and had one that didn't work (SRO Building in Harlem). It really depends on what the upside of your project is, and then evaluate the risk with the tenants. 

    2Reply
  • Brandon CohenPro Member
    Real Estate Agent · New York, NY · Member since 2014 · 160 posts · 45 votes
    10mo

    Completely neighborhood and plan dependent, there's no rule of thumb.  A friend of mine received a 7 figure pay out...but that was for a loft in Tribeca where the the owner had been trying for many years to get them out.  Bottom line, if they've been there for many years you'll have to account for the fact that whatever you give them needs to be a replacement 

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