Supermodel Irina Shayk and her condo at 166 Perry Street has been relisted with a 24% discount and is among this weekend's open houses. (Compass)
Whether you're looking to rent or buy in New York City, in 2024, the terms for broker commissions have changed. This article breaks down what has changed and how it will likely impact renters, buyers, and sellers citywide.
In this article:
Local renters will no longer pay broker fees
In the past, one of the biggest shocks facing newcomers to New York City was the expectation that renters pay a broker fee. Given the city's already high cost of housing, the expectation that renters pay up to 15% of their first year's rent in brokerage fees has long struck renters and housing advocates as unfair. In November 2024, New York City Council approved a bill to shift broker fees to landlords.
If this concession sounds familiar, you're not imagining things since New Yorkers have been here before. In early 2020, broker fees on rentals were briefly banned, but the ban was overturned by early 2021. Unlike previous efforts to ban brokerage fees on rentals, which have been brought forward on the state level, the FARE (Fairness in Apartment Rental Expenses) Act was introduced by New York City Council Member Chi Ossé with an objective to:
If this concession sounds familiar, you're not imagining things since New Yorkers have been here before. In early 2020, broker fees on rentals were briefly banned, but the ban was overturned by early 2021. Unlike previous efforts to ban brokerage fees on rentals, which have been brought forward on the state level, the FARE (Fairness in Apartment Rental Expenses) Act was introduced by New York City Council Member Chi Ossé with an objective to:
Whether the FARE Act persists is yet to be seen. In late November 2024, the Real Estate Board of New York, which represents local brokers, had a "We're Not Backing Down" message posted on its homepage. However, unless the real estate community is able to challenge the current bill, New York City renters are no longer expected to pay broker fees.
Sellers are no longer expected to cover buyer and seller agent commissions
In the past, buyers had one notable advantage nationwide--sellers paid the fees for both the seller and buyer agent. For first-time buyers, this practice has always been especially welcome since not being on the hook to pay agent commissions leaves more money to invest in a home and cover closing costs. In 2024, following a $418 million settlement by the National Association of Realtors (NAR), real estate commissions across the United States started to play by a new set of rules.
In short, following the NAR ruling, sellers are no longer automatically expected to cover the 5-6% commission split between the buyer and seller agents. While the NAR ruling did not technically impact local brokers whose work is governed by the Real Estate Board of New York (REBNY) rather than NAR, the ruling has had an impact.
In short, following the NAR ruling, sellers are no longer automatically expected to cover the 5-6% commission split between the buyer and seller agents. While the NAR ruling did not technically impact local brokers whose work is governed by the Real Estate Board of New York (REBNY) rather than NAR, the ruling has had an impact.
Following the NAR ruling, REBNY introduced its own revised guidelines, which also effectively decoupled commissions. Under the new guidelines, offers of compensation must come directly from the sellers and/or owners of the Exclusive Property. This effectively means that listing brokers are no longer able to make an offer of compensation to the buyer's broker, even if it is in the best interest of their client. Additionally, listing brokers will no longer pay the buyer's agent's compensation. So, in a nutshell, under the new rules, agent commissions must be negotiated, but this doesn't necessarily mean that much will change.
The key thing that has changed is that potential buyers must sign an agreement clarifying the commission terms before they start touring properties. Despite this step, most industry professionals agree not much else has changed, at least not yet. For now, most buyers are sticking with the status quo and continuing to cover commissions for their own agent and the buyer's agent.
While this may seem surprising, there are at least two reasons New Yorkers may end up sticking with the status quo when it comes to commission structures. First, sticking with the status quo reduces negotiations and keeps deals moving as quickly as possible, which is important in a city where it typically takes months, not weeks, to close on a property. Second, in a real estate market where buyers still expect to avoid paying fees, downloading broker fees to the seller is a sure way to reduce the number of potential buyers for a unit. In a sluggish market, it goes without saying that few sellers can afford to take this risk.
The impact of new broker commission structures on the NYC housing market
It seems likely that shifting brokerage fees from renters to landlords may stimulate the rental market, though likely not until spring 2025 as few people move during the holiday season. In fact, traditionally, November to February was already one of the few times of the year when fees were frequently covered by landlords, not renters, due to the slow market.
The impact of the revised commission rules on sales is yet to be seen. In the current market, however, it seems unlikely that buyers, sellers, or their agents will feel any major impacts from the new and more transparent commission structure in the near future. If and when the market becomes highly active again, however, and bidding wars return, it is possible that a growing percentage of buyers may offer to pay agent commissions as it is a sure way to put more cash in the seller's pocket.
The impact of the revised commission rules on sales is yet to be seen. In the current market, however, it seems unlikely that buyers, sellers, or their agents will feel any major impacts from the new and more transparent commission structure in the near future. If and when the market becomes highly active again, however, and bidding wars return, it is possible that a growing percentage of buyers may offer to pay agent commissions as it is a sure way to put more cash in the seller's pocket.
Listings with upcoming open houses
The River Arts, #7L90
$525,000
Washington Heights | Cooperative | Studio, 1 BathOpen House: Sunday, February 9, 2025
The River Arts, #7L90 (Compass)
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315 East 69th Street, #4K
$665,000
Lenox Hill | Cooperative | 1 Bedroom, 1 BathOpen House: Sunday, February 9, 2025
315 East 69th Street, #4K (Compass)
The Frost House, #6H
$725,000
Lenox Hill | Cooperative | 1 Bedroom, 1 BathOpen House: Sunday, February 9, 2025
The Frost House, #6H (Compass)
320 East 86th Street, #4E
$749,000
Yorkville | Cooperative | 2 Bedrooms, 1 BathOpen House: Sunday, February 9, 2025
320 East 86th Street, #4E (Douglas Elliman Real Estate)
The Niagara, #10B
$759,000
Carnegie Hill | Cooperative | 1 Bedroom, 1 Bath
Open House: Saturday, February 8, 2026
The Niagara, #10B (Brown Harris Stevens Residential Sales LLC)
Morningside Gardens, #18G
$775,000
Morningside Heights | Cooperative | 2 Bedrooms, 1 Bath | 950 ft2Open House: Sunday, February 9, 2025
Morningside Gardens, #18G (Corcoran Group)
75 Wall Street, #24R
$785,000
Financial District | Condominium | Studio, 1 Bath | 1,011 ft2Open House: Saturday, February 8, 2025
75 Wall Street, #24R (Platinum Properties)
The Orion, #6M
$795,000
Midtown West | Condominium | 1 Bedroom, 1 Bath | 615 ft2Open House: Sunday, February 9, 2025
The Orion, #6M (Engel & Volkers New York Real Estate LLC)
Concord Village, #7A
$815,000
Downtown Brooklyn | Cooperative | 2 Bedrooms, 1 BathOpen House: Sunday, February 9, 2025
Concord Village, #7A (Compass)
609 Second Avenue, #603
$895,000
Gramercy Park | Condominium | Studio, 1 Bath | 478 ft2Open House: Saturday, February 8, 2025
609 Second Avenue, #603 (Douglas Elliman Real Estate)
85 Hudson Avenue, #2A
$900,000
DUMBO | Condominium | 1 Bedroom, 1 Bath | 816 ft2Open House: Sunday, February 9, 2025
85 Hudson Avenue, #2A (Compass)
1242 Hancock Street, #2
$950,000
Bushwick | Condominium | 2 Bedrooms, 2 Baths | 929 ft2Open House: Sunday, February 9, 2025
1242 Hancock Street, #2 (Serhant)
57 East 75th Street, #1F
$1,010,000
Park/Fifth Ave. to 79th St. | Cooperative | 1 Bedroom, 1 BathOpen House: Sunday, February 9, 2025
57 East 75th Street, #1F (Compass)
71 West 83rd Street, #3R
$1,600,000
Central Park West | Cooperative | 2 Bedrooms, 2 BathsOpen House: Sunday, February 9, 2025
71 West 83rd Street, #3R (Douglas Elliman Real Estate)
357 4th Street, #2
$1,995,000
Park Slope | Condominium | 3 Bedrooms, 2 Baths | 1,278 ft2Open House: Sunday, February 9, 2025
357 4th Street, #2 (Garfield Realty Corp)
The Grand Sutton, #18B
$2,150,000
Beekman/Sutton Place | Condop | 3 Bedrooms, 3 Baths | 1,800 ft2Open House: Sunday, February 9, 2025
The Grand Sutton, #18B (Berkshire Hathaway HomeServices New York Properties)
450 West End Avenue, #5B
$2,499,000
Riverside Dr./West End Ave. | Cooperative | 3 Bedrooms, 2 Baths | 1,930 ft2Open House: Sunday, February 9, 2025
450 West End Avenue, #5B (Compass)
Eastlight, #30C
$2,570,000
Gramercy Park | Condominium | 2 Bedrooms, 2 Baths | 1,118 ft2Open House: Saturday, February 8, 2026
Eastlight, #30C (CORE Group Marketing LLC)
166 Perry Street, #1C
$3,195,000 (-23.9%)
West Village | Condominium | 2 Bedrooms, 2.5 Baths | 2,462 ft2Open House: Sunday, February 9, 2025
166 Perry Street, #1C (Compass)
One Hundred Barclay Tribeca, #15C
$3,790,000
Tribeca | Condominium | 3 Bedrooms, 3 Baths | 1,983 ft2Open House: Sunday, February 9, 2025
One Hundred Barclay Tribeca, #15C (Compass)
52 East End Avenue, #12AC14BC
$3,995,000
Yorkville | Condominium | 4 Bedrooms, 5.5 Baths | 4,107 ft2Open House: Sunday, February 9, 2025
52 East End Avenue, #12AC14BC (Brown Harris Stevens Residential Sales LLC)
Park Avenue Court, #RPH2B
$6,950,000
Carnegie Hill | Condominium | 4 Bedrooms, 4.5 Baths | 2,595 ft2Open House: Sunday, February 9, 2025
Park Avenue Court, #RPH2B (Corcoran Group)
Would you like to tour any of these properties?
Just complete the info below.
Or call us at (212) 755-5544
Would you like to tour any of these properties?
Contributing Writer
Cait Etherington
Cait Etherington has over twenty years of experience working as a journalist and communications consultant. Her articles and reviews have been published in newspapers and magazines across the United States and internationally. An experienced financial writer, Cait is committed to exposing the human side of stories about contemporary business, banking and workplace relations. She also enjoys writing about trends, lifestyles and real estate in New York City where she lives with her family in a cozy apartment on the twentieth floor of a Manhattan high rise.
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