The Real Estate Board of New York to The New York City Department of Consumer and Worker Protection re: Proposed Rule Regarding Junk Fees

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The Real Estate Board of New York (REBNY) is the City's leading real estate trade association representing
commercial, residential, and institutional property owners, builders, managers, investors, brokers,
salespeople, and other organizations and individuals active in New York City real estate. REBNY appreciates
the opportunity to comment on the Department of Consumer and Worker Protection's (the "Department")
proposed rule regarding junk fees (the "Proposed Rule").

The Proposed Rule "applies to any person who offers, displays or advertises goods or services in New York
City," and establishes that "[i]t is a deceptive and unconscionable trade practice for any person to offer,
display, or advertise the price of a good or service without disclosing the total price in a clear and
conspicuous manner."(1)

For the reasons outlined below, the Proposed Rule's broad application to include the real estate brokerage industry is concerning for the REBNY broker members who earn commissions upon the successful transaction of real property.

Commissions are negotiable and not set by law.(2) Consumers hiring a real estate broker are free to negotiate
how the broker will be compensated for their services. Compensation forms vary. They could be based
upon a percentage of the property's final sale price, a flat fee, or some other formula. Moreover, each real
estate transaction is different and could involve fees that are not immediately disclosed until a subject
property is identified. For example, certain housing cooperatives may charge an application fee while others
may not.(3) Therefore, it is not possible to calculate the "total price," as defined by the Proposed Rule, of a
real estate broker's service at the time the service is advertised.

Notwithstanding the above, the Proposed Rule applies "except to the extent that regulation of such offer,
display or advertisement is preempted by federal or state laws or regulations."(4)

The Proposed Rule should be amended to expressly recognize applicable local laws. For example, the City of
New York recently enacted legislation requiring the disclosure of certain fees associated with rental housing.
Accordingly, state and local laws that may preempt the Proposed Rule's application include:

• New York State's Housing Stability and Tenant Protection Act (HSTPA) of 2019, which limits
  background and credit check fees to $20 and waives such fees if the tenant presents a credit check
  conducted within the past 30 days. HSTPA also limits late fees in connection to rental payments
  made after five days of the due date to the lesser of $50 or 5% of the monthly rent.(5)

• New York City's Fairness in Apartment Rental Expenses Act (Local Law 2024/119), which requires
  disclosure of any fee to be paid by the prospective tenant for the rental of real property and an
  itemized written disclosure of any fees that the tenant must pay to the landlord in connection with
  such rental.(6)

In conclusion, REBNY respectfully requests that real estate brokers and brokerages be exempted from the
Proposed Rule. Absent such an exemption, REBNY requests further guidance from the Department regarding
the application of the Proposed Rule, including its "total price" disclosure requirement to real estate
brokers and brokerages.

(1) Proposed Rule, §§ 5-16(b) and (c)

(2) National Association of REALTORS®, What the NAR Settlement Means for Home Buyers and Sellers (May 24, 2024) ("broker fees and commissions are fully negotiable and not set by law"), https://www.nar.realtor/the-facts/what-the-nar-settlement-means-for-home-buyers-and-sellers, accessed August 6, 2026

(3) Even the amount of application fees vary among cooperative housing corporations.

(4) Op. Cit., § 5-16(b)

(5) New York Real Property Law §238-a.

(6) Local Law 61 of 2025

CONTACT:
Zach Steinberg
Executive Vice President
Real Estate Board of New York
[email protected]