Paying for Pushout: Regulating Landlord Buyout Offers in New York City's Rent-Stabilized Apartments

Abstract

The feelings of frustration and marginalization among longtime residents who are displaced as their neighborhood gentrifies are often magnified as landlords often turn to aggressive and abusive tactics to compel longtime residents to leave. This Note focuses on New York City, where the problem of abusive tenant displacement is particularly acute: under New York’s rent-regulation regime, landlords in gentrifying neighborhoods often stand to profit tremendously if they successfully force tenants out of rent stabilized apartments. This Note specifically investigates how landlords attempt to induce tenants to abandon their rent-stabilized units by proffering “buyout” deals; tenants are offered a lump sum to vacate their apartments, and these offers are often undergirded by abusive tactics, including threats of eviction proceedings and discontinued maintenance. The first part of the Note provides a detailed qualitative account of buyout practices in low-income, rapidly gentrifying neighborhoods in New York City, infused with interviews with residents, community organizers, and legal aid attorneys. The second part of the paper evaluates the legality of this process under current New York City and State law and federal consumer protection laws. The third part provides some suggestions for regulating the buyout practice through legal rule changes, positioning the discussion within the broader national political discourse around consumer protection regulations. I address anticipated criticisms of my proposal and argue that regulation of the buyout practice through a “compulsory term” is necessary and desirable to ensure fairness in landlord-tenant bargaining in the gentrification context and to prevent buyouts from undermining the purpose of New York’s rent-regulation system.

Keywords: Housing Law, Housing Policy, Gentrification, Consumer Protection, Tenant Protection, Private Law, Legal Theory, Contract Theory