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The building I’ve lived in for 13 years just was sold. The new owner wants to convert the two largest apartments (one of which is mine) into smaller apartments or community office space. My lease is not stabilized, but I pay below market rate and have almost two years left. Do landlords ever buy out non-stabilized leases?
Theoretically, it's possible that a landlord would buy out a market-rate tenant—but it's also highly unlikely, our experts say.
Landlords might be inclined to consider buyouts of rent-stabilized tenants because those renters have additional protections, including guaranteed lease renewal (provided they haven't done anything that warrants eviction.) So in the event that a landlord wants to renovate a building, deregulate apartments, and move in higher-paying tenants, they may find it easier to buy you out than to wait you out.
With market-rate tenants, though, landlords can simply opt not to renew your lease when it comes time to do so.
"I have never done a buyout for a non-regulated tenant. I suppose it's theoretically possible if someone buys a building and wants to do a demolition, and a tenant is one month into a two-year lease, but it ranges from exceedingly rare to non-existent," says Sam Himmelstein, a lawyer who represents residential and commercial tenants and tenant associations (FYI, a Brick sponsor).
Himmelstein says he has seen buyouts in the case of market-rate commercial tenants, who typically sign multi-year leases. In these cases, if a developer wants to convert the building, the tenant could potentially negotiate for a lucrative buyout, but this would be highly unusual market-rate residential tenants.
There may be one caveat in your case: It's always possible in the world of NYC real estate that your apartment was illegally deregulated at some point in its history. If you can track down evidence of this and prove that you should, in fact, be stabilized, you could be entitled to recouping rent overcharges, having regulated status reinstated, and maybe snagging that buyout.
"In these situations, I often counsel the tenant to obtain their rent history in order to see if we can make a colorable claim to rent stabilization status," Himmelstein says. "That could and often does change the discussion."
You can request your apartment's rental history through state division of Homes and Community Renewal. And while you're at it, take a look at our guide to figuring out whether your apartment should be rent-stabilized.
For more Ask an Expert questions and answers, click here.
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