In a swift and unexpected turn, New York City’s rental market has undergone significant disruption following the enactment of the Fairness in Apartment Rental Expenses (FARE) Act on June 11, 2025. The new law, which bans landlord-side brokers from charging tenants up-front commissions, was intended to alleviate one of the city’s steepest moving costs. Instead, it has triggered a sharp increase in monthly rents and a notable drop in publicly listed apartments.
Within just a week of the law taking effect, average Manhattan rents surged by approximately 15 percent, jumping from around $4,750 to $5,500. The spike comes as landlords move swiftly to recoup broker costs by incorporating them into monthly rental prices—effectively transferring what was once a one-time fee into a permanent housing expense.
The law was hailed as a consumer protection breakthrough by city officials and housing advocates, with initial estimates suggesting tenants could save thousands in upfront fees. However, analysts and renters are now sounding the alarm over its unintended consequences. Data from real estate analytics firm UrbanDigs shows a 30 percent drop in active Manhattan listings in the days following the law’s implementation. The abrupt inventory plunge has been attributed to a surge in so-called “shadow listings”—apartments no longer publicly advertised on major platforms like StreetEasy but instead offered through informal broker channels or private networks.
Reports from renters suggest some brokers are presenting two sets of pricing for the same unit: one with the broker fee folded into the rent and one where the tenant pays the fee separately—an apparent end-run around the law’s intent. Others allege that vague new fees, sometimes labeled as “management” or “tech services,” are being tacked on at lease signing, often totaling several thousand dollars.
“The market reaction has been swift and aggressive,” said John Walkup, co-founder of UrbanDigs. “Landlords are adapting quickly, and unfortunately that means higher monthly costs for renters and less transparency across the board.”
This tactic, industry insiders say, is a classic example of cost-shifting in regulated markets. Compass agent James Finelli noted that many listings saw rents hiked by $400 or more per month in anticipation of the law, effectively embedding the broker’s cost into the base price. The practice is particularly common in non-rent-stabilized buildings, which make up about half of New York City’s rental housing stock.
City officials and tenant advocacy groups are now scrambling to assess the law’s short-term fallout. The Department of Consumer and Worker Protection (DCWP), tasked with enforcing the new regulations, has already received nearly 300 complaints regarding brokers or landlords allegedly circumventing the broker-fee ban. Violations can result in fines of up to $2,000 and potential license suspensions or revocations by the Department of State.
“We expected some resistance, but what we’re seeing is a coordinated retreat into opacity,” said Linda Gonzalez, a housing rights attorney with the NYC Renters’ Alliance. “If the goal was to increase affordability and transparency, we’re moving in the opposite direction.”
The law’s supporters argue that the shift was always going to require a period of adjustment. Council Member Chi Ossé, who championed the bill, acknowledged the challenges but remained optimistic. “This law represents progress, and like all progress, it’s being tested. Our job now is to ensure compliance and continue fighting for fairer housing.”
However, critics suggest the law lacked sufficient implementation guardrails. “What’s missing is real enforcement and oversight,” said Jonathan Miller, president of appraisal firm Miller Samuel. “You can’t just ban a fee and expect the market to behave altruistically.”
As the city grapples with fallout from the FARE Act, its effects are being closely watched in other cities considering similar legislation. The move reflects a broader national trend toward reducing upfront rental costs—but also highlights the complex dynamics at play when attempting to regulate deeply entrenched housing practices.
In the coming weeks, tenant groups are calling for more rigorous enforcement of the law and potential amendments to close emerging loopholes. Suggestions include stricter rules on shadow listings, clearer definitions of illegal fees, and public disclosure requirements for rental pricing.
For now, renters are urged to remain vigilant. City officials recommend documenting all communications with brokers and landlords, asking for itemized breakdowns of all rental charges, and reporting suspected violations to the city’s 311 hotline or online portal.
As New York City’s housing market recalibrates, the FARE Act serves as a high-profile test of whether ambitious tenant protections can hold firm in the face of entrenched industry practices.