Thiele's Law Passes; Landlords May Collect Rent For Whole Summer Upfront - 27 East

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Thiele’s Law Passes; Landlords May Collect Rent For Whole Summer Upfront

Brendan J. O’Reilly on Sep 28, 2021

A new state law has clarified that deposits and advance payments for seasonal rentals are not subject to caps, which means that landlords can collect rent for an entire summer upfront.

Assemblyman Fred W. Thiele Jr. penned the legislation, which Governor Kathy Hochul signed last week. It was designed to make clear that limits imposed by New York State’s Housing Stability and Tenant Protection Act of 2019 only apply to permanent housing, not to vacation rentals.

Prior to the Housing Stability and Tenant Protection Act, it had been common practice for East End landlords require a single payment for the entire summer prior to the tenant moving in. The 2019 law made that practice illegal when it barred landlords from collecting more than one month’s rent as a deposit or advance. However, Mr. Thiele says that the law was never designed to apply to vacation rentals.

Mr. Thiele’s legislation states that in order for landlords to collect a season’s rent upfront, the dwelling must be registered with its local municipality as a seasonal rental unit and the unit cannot be rented out for seasonal use for more than 120 days per year. The tenant must have a primary residence to return to, and the address of that residence must be provided in the seasonal rental’s lease.

On the East End, Mr. Thiele’s legislation will protect landlords of seasonal rentals from nonpayment of rent during the most lucrative time of year, between Memorial Day and Labor Day. It could be that a tenant vacates early and refuses to pay for the balance of the lease term, or that a tenant stays but stops paying. Either way, it is a situation landlords of vacation rental units no longer need to worry about.

“Summer rentals are a vital part of the local economy on the East End,” Mr. Thiele said in a press release. “A change in well-accepted business practices of requiring a single payment for a seasonal rental would adversely affect the real estate market and our economy. Not only was the HSTPA not intended to cover seasonal rentals, there is no documented problem with the practice of a single payment. I thank Governor Hochul for recognizing that these types of short-term tenancies require a different regulatory approach than permanent dwellings by signing this important legislation into law.”

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