Skip to Content
CityRealty Logo
Midtown

Sublet or pay up? How homeowners could avoid the 2nd-home tax + Luxury listings for rent in condo/co-op buildings

1228 Madison Avenue, #2 (SERHANT) 1228 Madison Avenue, #2 (SERHANT)

A report from Corcoran Group found that Manhattan’s median rent reached a record high of $5,295/month per month in June 2026, up 6 percent from the same period a year earlier. With available listings down 16 percent year-over-year, the tight market is unlikely to ease quickly. It is important to note that such reports are based on asking rents for market-rate listings and do not reflect what existing tenants are paying or account for the city’s rent-stabilized inventory. Even so, the figures are daunting, and Our Town notes that elected officials remain divided over how to address the problem, from rent freezes to building more housing.

One unexpected consequence of the city’s new pied-à-terre tax could be the release of more apartments into the rental market. Corcoran’s report came shortly before property owners began receiving letters from the New York City Department of Finance notifying them that they may be subject to an annual surcharge on second homes valued at $1 million or more. However, certain properties may be eligible for exemptions, including luxury second homes being used as a primary residence by a tenant.

 

In this article:

113 East 64th Street
113 East 64th Street Park/Fifth Ave. to 79th St.
The Oxford, 422 East 72nd Street
The Oxford, 422 East 72nd Street Lenox Hill
300 East 79th Street
300 East 79th Street Lenox Hill
241 East 76th Street
241 East 76th Street Lenox Hill
Bridge Tower Place, 401 East 60th Street
Bridge Tower Place, 401 East 60th Street Lenox Hill
To prevent sham rental arrangements created solely to avoid the tax, exemptions will only be granted if owners and tenants can provide extensive documentation proving that the apartment is the tenant’s primary residence. This may include a current lease or tenant affidavit, residency documents such as tax returns, and additional materials like utility bills, rent payment receipts, or renter’s insurance. Even with these requirements, some real estate professionals believe the pied-à-terre tax could encourage more owners to rent out luxury apartments rather than leave them vacant. A new wave of high-end rentals could push rent statistics even higher, but it could also provide some modest relief by bringing more existing housing units into use without the delays of new construction.
However the policy plays out, subletting and renting out apartments have long been part of New York City life. Whether an owner is spending the summer in the Hamptons, taking a temporary job elsewhere, holding an apartment as an investment, or looking for help covering monthly housing costs, leasing out a home can be a practical and mutually beneficial arrangement, especially for tenants planning a temporary stay in the city. But before moving forward, owners should carefully consider the legal, financial, and building-specific rules involved. Below, we break down the logistics of subletting in New York City and highlight a selection of attractive sublets at various price points.

The legality of sublets

 

If you’re leaving town and looking to sublet for fewer than 30 days, we’re sorry to say that you may be out of luck: New York State and City laws prohibit this venture. Platforms like Airbnb remain legal in New York City, but such units must be registered with New York’s Short-Term Rental Registration Portal as per Local Law 18.

If you are going to be away for a month or longer, the city and state allow you to sublet your apartment. However, what your building allows you to do is a different matter.

Co-op owners

For co-op owners, the answer depends on the board. Some boards may outright prohibit sublets, or not allow them to take place until the owner has lived in the building for a certain amount of time. Still others allow subletting from day one, but may insist on approving subletters almost as strenuously as they do the main shareholder.

Condo owners

As condo units within residential buildings are individually owned, they have more leeway with subletting than their co-op counterparts. However, that does not mean they get total carte blanche. Condo management is typically overseen by boards or homeowners associations (HOAs) that enforce rules designed to maintain property values and enhance community well-being. Some condo boards will simply want to be informed of your plans, while others might want to meet candidates and have the authority to accept or deny them.

Renters

If you’re a renter, the situation is a bit more complicated. The NYC Rent Guidelines Board says that most renters are “entitled to request permission to sublet from the owner, and the owner may not unreasonably refuse such permission.” However, the guidelines further state that the renter must “inform the owner by certified mail, return receipt requested, no less than 30 days prior to the proposed subletting.” Moreover, the request must contain a) the term of the sublease; b) the name of the proposed sublessee; c) the business and permanent home address of the proposed sublessee; d) the reason for the sublet request; e) your address for the term of the sublease; f) written consent from any co-tenant or guarantor on the lease; and g) a copy of the proposed sublease (along with a copy of your lease, if available) acknowledged by the tenant and subtenant as a true copy of the sublease.

During the 30-day notice period, landlords may request additional information or documentation regarding your sub-tenant. If 30 days pass and the landlord does not say anything, you can legally assume they have granted approval by default and can move forward. You can also proceed if the owner “unreasonably withholds consent to sublet,” though this may prove more trouble than it’s worth.

The logistics of sublets

Once permission has been granted, the first thing to do is to determine how much you can charge. Some owners charge a “sublet allowance” (usually 10% of your rent), and you are permitted to pass this fee along to your subletter. If you are planning to leave the apartment furnished while you are away, you can add a 10% premium. But beyond these fees, you cannot legally charge more for your unit than you are paying.
Once you’ve found a subtenant for the price you’re charging, the next step is to sign a sublease agreement. This must contain the timeline, the reason for the sublet, the rent, the security deposit, and any relevant building rules. It must also include the subtenant’s name and contact information, as well as any required consents from co-tenants (e.g. roommates) or guarantors (yours or theirs).

The legality of home swaps

 

Unlike sublets, home swaps fall into a gray zone. It all comes down to how one interprets the law. One might say that if someone is in your unit when you’re not there, it is a sublet. Someone else might argue that as long as no money has exchanged hands, it is not a sublet. For this reason, in New York City, one should always proceed with caution when home swapping but not necessarily rule it out.

 

As a rule, if you own your own home—for example, a townhouse in Park Slope—you can do whatever you like for whatever period of time. If you own a co-op, you should definitely still check with your board. While the board may be flexible, most co-op boards will want to know who will be occupying your unit while you’re on vacation. In addition, some co-ops may place time limits on home swaps (e.g., only permit home swaps for up to two weeks). Condo residents may or may not face similar restrictions.

 

Again, when it comes to home swaps, renters will generally face more restrictions than owners. That said, according to New York State law, home swaps are technically legal. If you live in a class A dwelling (i.e., any building with three or more units), according to the New York Multiple Dwelling Law, the “incidental and occasional occupancy of such dwelling unit for fewer than thirty” is legal provided “the permanent occupants are temporarily absent for personal reasons such as vacation or medical treatment” and “provided that there is no monetary compensation paid to the permanent occupants for such occupancy.” In other words, a renter can do a home swap, provided it is less than 30 consecutive days in length. Still, renters are strongly advised to only proceed if they have first informed their unit’s owner and/or their management company, informed their neighbors, and if they live in a co-op or condo, received permission from the building’s board.


50 Bayard Street, Unit 3H One Williamsburg Wharf, 480 Kent Avenue, #11B | One Williamsburg Wharf, 480 Kent Avenue, #11B

Is it worth it?

 

Every year, thousands of New Yorkers enjoy the payback from swapping and subletting their homes. But how do you know whether yours will be worth it?

 

To answer this question, you first need to consider all the potential risks. If you’re worried that your decision to sublet may cause damage to your home, building, or long-term relationships with your neighbors or co-op board, you may not want to sublet or engage in a home swap. The short-term financial gain won’t be worth it if you create long-term problems in the process. Likewise, if you’re a renter and there is any risk your sublet might lead to an eviction, don’t do it. Even if you don’t love your current apartment, bear in mind that an eviction will tarnish your reputation as a renter and may impact your ability to rent in the future.

 

 

In addition, consider which scenario will ultimately be more relaxing. Subletting or home swapping an expensive apartment may ease your mind during this especially stressful time. But don’t underestimate the stress associated with preparing your home for visitors, especially for strangers who will ultimately be able to leave a rating of you and your home on a public platform. It can take anywhere from a few hours to several days to properly clean and stage a home for visitors. In addition, if you're out of state and unable to answer messages or questions right away, it can be disquieting to worry about whether or not your sublesser has arrived and successfully moved in.

The Bottom Line

The bottom line is that if you are a) leaving for more than 30 days (or home swapping for less time); b) have gained permission to sublet or home swap from your co-op or condo board, immediate neighbors, and/or owner or manager; and c) can handle the stress of inviting strangers into your home, a sublet or home swap may be a great idea. If you’re at all worried about the logistics, preparation, and potential things that might go wrong in your absence, you may be better off leaving the dust to settle in your New York City apartment while you wait this out elsewhere.

 



Ultra-luxury rental sublets


300 East 79th Street, #PHC/D (Douglas Elliman Real Estate)

J.W. Marriott Essex House, #3401 (CitiSuites International Realty LLC)

101 Warren Street, #3250 (Douglas Elliman Real Estate)

350 West Broadway, #4 (Douglas Elliman Real Estate)

The Oxford, #32DE (Sothebys International Realty)

The Park View, #PH (Christies International Real Estate Group LLC)

113 East 64th Street, #TH (Nest Seekers LLC)

Ritz Tower, #25EW (Compass)

1228 Madison Avenue, #2 (Serhant)

49 Chambers Street, #PHB (Douglas Elliman Real Estate)

15 West 68th Street, #TH (Brown Harris Stevens Residential Sales LLC)

Recently listed sublet rentals in NYC


110 Livingston Street, #8R (Corcoran Group)

One Rector Park, #313 (Battery Park Realty Inc)

The Industry, #2G (DGSIR Realty)

Harridge House, #5M (Douglas Elliman Real Estate)

478 3rd Street, #2R (Berkshire Hathaway HomeServices New York Properties)

One Manhattan Square, #15L (Extell Marketing Group LLC)

The Grand Millennium, #30C (ALTA Real Estate)

Sheffield 57, #33H (Douglas Elliman Real Estate)

77 Charlton Street, #S12D (Douglas Elliman Real Estate)

Iris TriBeCa, #16A (Douglas Elliman Real Estate)

Tower 53, #11BC (The Agency Brokerage)

76 Madison Avenue, #9A (Douglas Elliman Real Estate)

Lead image via Pixabay
{{error}}

Related Articles

Get To Know

The Ideal Floor Plan: How to tell if a NYC apartment really works + 25 listings with great layouts

Today, July 30, 2026
Great Listings

25 NYC residential buildings with acclaimed in-house restaurants as Polo Bar plans move to 625 Madison

Tuesday, July 28, 2026
Future New York

Views, Light, and Value: A Q&A with Kayla Lee on what today’s NYC buyers really want

Friday, July 24, 2026
Future New York

NYC apartments with on-site parking from $350K as new Empire Bins to claim curb space

Tuesday, July 21, 2026
Future New York

Urban Edens: 20 NYC condo developments with lush resident gardens; Sales launch at The Morgan from $975K

Monday, July 20, 2026
Get To Know

Steals & Deals from $345K: Listings with "Motivated Sellers" or "Priced to Sell"

Friday, July 17, 2026
Future New York

The best new Brooklyn condos with entertainment amenities for watching the World Cup finals

Friday, July 17, 2026
Great Listings

In honor of Bastille Day, see NYC's grandest Beaux-Arts and French Renaissance-style buildings

Wednesday, July 15, 2026
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.

More Rental Deals

Updated Amenities / Renovations

The Serrano is renting gracious Upper East Side apartments with beautiful views and updated amenities from $5,395/mo.

Updated Amenities / Renovations

Q&A with Ben Picket on Gotham Organization tech-forward approach to improving luxury rental living

Leasing Updates

How NYC’s 2026 rent freeze is different from past rent freezes + New affordable housing lotteries with rent-stabilized units

Leasing Updates

The Lotus: Eco-friendly Murray Hill rental gears up for leasing launch and affordable lotto

Grand Opening

New developments in Murray Hill as Midtown prepares for influx office-to-residential conversions

Special Offers

Avalon Fort Greene offering discounts on select units; No-fee rentals from $2,845/month

Special Offers

Security Deposit Discounts at Beatrice Apartments in Chelsea; No Fee Rentals from $3,855/Month

Special Offers

East Harlem's The Heritage on Central Park: Renovated Rentals with Incentives from $2,595/Month