NYC Renters Could Become Owners Under New Housing Law

NEW YORK CITY— Property owners selling buildings under financial or physical hardship will need to notify the City and a list of nonprofit buyers before placing it on the open market.

Mayor Zohran Mamdani signed the Community Opportunity to Purchase Act, sponsored by Council Member Sandy Nurse, on Tuesday, which applies to certain building with more than four units.

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If the property owner receives an offer from another buyer, a qualified nonprofit would have the right to match that offer and purchase the property under the same terms.

Only specific properties and reasons for selling would qualify.

For example, if an owner cannot pay property taxes or afford to fix severe maintenance problems, then COPA would take effect.

The legislation could preserve affordable housing and give tenants a path to collective ownership.

Boris Santos, president of the East New York Community Land Trust, cited the organization's 2024 acquisition of 248 Arlington, a 20-unit rent-stabilized building in East New York, as an example.

Working with tenant leaders, the trust oversees major renovations with the City and plans to convert the building into a cooperative in which tenants collectively own and manage the building, while the trust retains ownership of the land to ensure long-term affordability.

Santos said COPA would make similar acquisitions more attainable for community land trusts, nonprofits and tenant groups seeking to protect housing from speculative investment.

"Who better to run a building than the people who live there?" Santos said.

The bill passed in October with 38 Council members voting in favor, nine voting against and two abstaining.

Mayor Eric Adams vetoed an earlier version of the legislation, opposing the measure over concerns about its potential impact on property owners and the housing market.

Small Property Owners of New York, an organization representing small landlords, opposed the measure, arguing it could reduce property values and limit owners' ability to sell to conventional buyers.

"COPA, in any form, is a destructive housing policy for renters, owners, and affordable housing," Ann Korchak, the organization's board president, said.

COPA would give eligible nonprofits and qualifying partnerships 20 days to submit a statement of interest and 70 days to make an initial offer.

Because of that timeline, Korchak said the policy could steer open-market buyer towards buildings without a COPA process, since conventional buyers might not want to jump through the red tape.

Property owners could seek exemptions by demonstrating undue financial hardship.

In these scenarios, a property owners operating a loss with a buyer ready to purchase the building could argue that the additional delay worsens an already unsustainable financial situation.

In some cases, foreclosures or other penalties an owner faces could be grounds for an exemptions.

COPA would not automatically create new affordable apartments or require every building purchased by a nonprofit to charge below-market rents.

Its effect would depend on whether nonprofits can secure financing, complete purchases and maintain affordable rents over time.

Nonprofits could also seek to preserve affordability through building management, renovations and long-term ownership.

But Tuesday's bill signing came amid controversy over the administration's decision to revive a city program it had pledged to eliminate: the tax lien sale.

The Mamdani's administration plans to resume New York City's tax lien sale in mid-2027 after suspending the program for a six-month review.

The City places liens on properties when owners fall behind on property taxes or water bills, typically selling eligible debts to privately managed trusts that seek to collect the money and can ultimately pursue foreclosure.

Mamdani, who campaigned on ending the practice, said the revised approach would include more intensive outreach to delinquent homeowners, multiple opportunities to resolve outstanding debts and avoid a lien sale, and a longer-term plan to establish a city land bank to manage distressed properties.