In New York City’s hot real estate market, some landlords dream of a new building, higher rental rates to boost profits, or simply to better cover building expenses. Buyouts are sometimes the only practical way to make these changes happen, but what happens when you make an offer and the tenant says No?
Contact Brasch Legal for help with Tenant buyouts
If you need assistance with the buyouts, contact Brasch Legal. We have worked in the field of landlord–tenant law for over 20 years and bring years of experience. We have helped many landlords with tenant buyouts. Just call (212) 267-2500 or email [email protected] for assistance.
Why Tenants say “no”
There are many reasons why a tenant may refuse a buyout offer. The offer may not be high enough, they may actually need more money to make a move possible, or they may not want to give up their low rent. Additionally, some tenants may be holding out hope that the offer will go even higher the longer they remain.
However, don’t assume that all tenants are greedy holdouts, hoping to land a massive payday for giving up their unit. Some genuinely need to remain in a place where the rent is affordable or the location has convenient access to public transit, work, friends, or family.
Landlord options when the Tenant says “no”
Landlords need to be careful when approaching a tenant who has already refused a buyout offer. NYC has very strong tenant protection laws that can make it difficult for landlords to pursue buyouts. The best course of action a landlord can take with a tenant who has refused a buyout offer is to keep the lines of communication open.
Sometimes tenants are surprised by an offer and their knee-jerk reaction is to reject it. If this happens to you, don’t get mad but accept their answer and tell them they can always change their mind later and that you will welcome the conversation. Or, if you’re open to it, suggest they think about it and make you a counter-offer.
While these are things you can do once an offer has been rejected, there are also several things you should NOT do if your initial buyout offer has been rejected:
1. Do not make repeated offers within 6 months of one another. In 2015, New York passed new rent laws that prohibit landlords from making repeated buyout offers within 6 months of one another. Unless the tenant approaches you, you cannot approach the tenant with a new offer until 180 days have passed since the prior offer. So don’t low-ball the offer unless you’re sure the tenant will take it. Doing this can push your timeframe back at least 6 months if they reject the offer.
2. Do not threaten or harass the Tenant. Landlords can now be fined up to $10,000 if they are found guilty of harassing tenants to accept a buyout offer. Do not threaten, coerce, or provide false information to the tenant in the hopes of getting them to move out or accept the buyout. Remain professional and carry on with business, as usual, to protect yourself from claims of harassment.
3. Do not try to evict the Tenant. You cannot evict the tenant without cause and you can’t evict them yourself. Don’t try to change the locks or create a case for eviction where none exists. You’ll likely find yourself losing in court and paying your own court costs as well as the tenant.
4. Do not neglect your responsibilities. You cannot try to “encourage” the tenant to move out by neglecting your duties. You must keep the building in good repair, the utilities on, make necessary repairs and maintenance, etc. pursuant to your lease.
Consult a Landlord-Tenant attorney for advice early on
If you are a landlord who is contemplating making a buyout offer to your tenants, contact the landlord-tenant attorneys at Brasch Legal. We can assess your situation and help you draft buyout agreements that are fair and reasonable, provide you with negotiating tips, manage the negotiations on your behalf, or advise you of your rights if an offer is rejected.
Whether the offer is accepted or not, legal advice can protect you from claims of harassment and prevent you from taking missteps that could derail your plans. If the offer is accepted, our attorneys can finalize the terms, facilitate the transaction, and ensure the move-out process goes according to plan.
Contact Brasch Legal for assistance
If you need assistance with buyouts and aren’t sure what to do, contact the tenant attorneys at Brasch Legal for advice. Please contact the team at Brasch Legal today at 212-267-2500 or online by clicking here or visit www.braschlegal.com.