Who Pays the Broker’s Fee When Tenant Retains the Broker?

Q: A tenant used a broker to rent an apartment from me, then wanted me to pay the broker’s fee. Are landlords required to pay all tenants’ brokers’ fees under the FARE Act, or only the fees of brokers that the landlord retains?

A: Beginning June 14, 2025, the Fairness in Apartment Rental Expenses (FARE) Act added new NYC Admin. Code §20-699.20 et seq., and made landlords, rather than residential tenants, responsible for covering broker fees when the landlord hires the broker. The Act defines a landlord to include the building owner, property owner, their agents, or employees. 

Under the FARE Act, there is a presumption that any broker who publishes an apartment listing is legally presumed to be working for the landlord and cannot charge the tenant a fee for that unit. In order to prevent workarounds and give tenants more freedom in selecting representation, the FARE Act also prohibits landlords from requiring tenants to work with specific brokers, such as those representing both sides of a deal (a practice known as “dual agency”). 

However, under the FARE Act, if a tenant, rather than the landlord, hires their own broker, the tenant is responsible for paying the broker’s fee. Under the Act, landlords also must provide a written, itemized list of all fees that the tenant is required to pay to the landlord or its agents before a tenant signs a lease agreement.

For additional information on the FARE Act, see “Fare Act Becomes Law, Shifts Broker Fees to Owners,” in the Insider’s February 2025 issue.