A preferential rent is a rent which an owner agrees the tenant, such as the tenant’s payment of the
to charge that is lower than the legal regulated rent electronically. Such lease clauses may be
rent that the owner could lawfully collect. challenged by the tenant in a rent overcharge or
lease violation complaint with DHCR or can be
Pursuant to the Housing Stability & Tenant reviewed by a court of competent jurisdiction.
Protection Act (HSTPA) of 2019, tenants that
were paying a preferential rent as of June 14, Example 1:
2019, retain the preferential rent for the life of the
tenancy. Rent Guidelines Board increases and Mr. Jones signed a one year lease, effective
other increases allowed by the Rent Stabilization October 1, 2018. The lease cited a legal regulated
Law or Emergency Tenant Protection Act are to rent of $1,200 and a preferential rent of $1,000.
be applied to the preferential rent. A tenant who
believes that they are entitled to a renewal lease 1. On October 1, 2019, when Mr. Jones’
with a preferential rent but is being charged more one year lease renewal begins, the legal
than that amount may file a rent overcharge or regulated rent increases by 1.5% to $1,218
lease violation complaint with DHCR or a court due to the annual rent guidelines board
of competent jurisdiction. (See Examples below.) increase, and the preferential rent increases
Please note that certain government regulatory by 1.5% to $1,015. Mr. Jones will pay the
agreement/financed affordable housing programs $1,015 rent.
may not be bound by this limitation; please contact
the supervising government agency for more 2. Owners can no longer terminate the
information. collection of the preferential rent at the time
of lease renewal pursuant to the HSTPA of
Owners may terminate the preferential