Security Deposit Return Requirements Expanded to Cover Rent-Regulated Tenants

On Oct. 16, 2025, Governor Hochul signed into law a housing bill that expands security deposit protections to tenants in rent-regulated apartments. 

Since passage of the Housing Stability and Tenant Protection Act of 2019 (HSTPA), General Obligations Law Section 7-108(e) has required landlords to return an unregulated tenant’s security deposit within 14 days of the tenant’s moving out, or else notify the tenant within that time that it was withholding the deposit, or a portion of the deposit, to cover damages. Failure to provide such notice within 14 days results in forfeiture of the right to retain the security deposit. 

The same provisions now apply to rent-controlled and rent-stabilized tenants.