NYREJ Publishes Article by Thomas Kearns on Seasonal Rental Issues
New York Actual Estate Journal printed an article on March 22 authored by Olshan Actual Property associate Thomas Kearns entitled “Regarding Seasonal Leases“.
One of many ironies of the substantial modifications made beneath New York State’s 2019 Housing and Stability and Tenant Safety Act is that the provisions limiting safety deposits to at least one month’s lease negatively affected luxurious seasonal leases within the Hamptons and different trip areas. Seasonal leases usually required advance cost of not less than half of the lease for the season. No exception for seasonal leases appeared within the textual content of the 2019 statute and cautious practitioners tried numerous work arounds.
In September final yr, New York’s Common Obligations Regulation Part 7-108 was amended to particularly exempt seasonal leases from the one-month safety deposit restrict however with some caveats.
First, the property have to be, and the lease should expressly state that the property is registered as a seasonal-use dwelling unit and the lease should embody the native or county authorities company with which is registered. Not all jurisdictions have an company accepting seasonal rental registrations. The cities of East Hampton, Southampton and Bedford, N.Y. seem to have rental registries. In a fast search, I didn’t discover a seasonal rental registry for the Village of Rhinebeck or Dutchess County, for instance. The brand new statute mentions a state registry, however I used to be not capable of finding any such registry. It’s unclear as to the affect of the shortage of such workplace beneath the brand new statute.
Second, the lease can’t exceed a 120-day time period, and the property can’t be rented as a seasonal rental to anybody for greater than 120 days each year, and third, the tenant should have, and the lease should recite, the first residence of the tenant that the tenant might return to after the lease expires.
All of this looks like plenty of legislative mind energy and in the end plenty of native authorities administrative complications to fight an issue not well-known to this writer: Wealthy individuals being abused on their summer time rental! Good luck to all attempting to adjust to these necessities.
Thomas Kearns is a associate with Olshan Frome Wolosky LLP’s actual property division, New York, N.Y.