On September 20, 2021, Governor Kathy Hochul signed an amendment to General Obligations Law §7-108, otherwise known as the Housing Stability and Tenant Protection Act (HSTPA). The amendment adds an exemption for “seasonal use dwelling unit” (SUDU) from the security deposit/advance restriction of “no more than one month’s rent”. The text of the amended sections can be found below.
As you may recall, the HSTPA limits the amount of the security deposit to one months rent and prohibited any advance on rent beyond the first month (this prohibited collecting the last month’s rent). Owners of seasonal properties that rented the property out for more than a month to the same tenant were forced to comply with the HSTPA and were only able to collect one month security deposit and the first month rent from tenants who may have leased the premises for the entire season like a Summer beach or Winter ski properties). These types of rentals are not typical landlord/tenant scenarios where leases are renewable and the tenant makes the property their primary residence but rather seasonal or vacation type properties to be occupied for less than 120 days per year by tenants.
To qualify as a SUDU the rental must meet all of the following requirements:
A. The lease expressly provides that:
(i) the dwelling unit is registered as a seasonal use dwelling unit, indicating the local or county government agency with which it is registered; and
(ii) the occupancy of the tenant is only for seasonal use not to exceed one hundred twenty days or a shorter period provided for in the lease; and
(iii) such tenant has a primary residence to return to, the address of which is expressly provided in the lease; and
B. Such dwelling unit is not rented as a seasonal use dwelling unit for more than one hundred twenty days during each calendar year; and
C. The local government with jurisdiction for building administration over such unit, the county in which such unit is located, or the state shall have adopted a seasonal use dwelling unit registry; and
D. Such unit shall be registered by filing a copy of the seasonal use lease and such additional information as the local government, county, or state agency that administers such registry may require.
As can be seen from the definition, there are specific requirements that need to be met to qualify for the exemption. The landlord will need to make sure that there is a local, county or state government “seasonal use dwelling unit registry” that is applicable to the property (at this time there is no state registry). If there is no local, county or state registry, the property would remain subject to the deposit/advance provisions of HSTPA and would not be able to claim the exemption.
If a licensee is listing property for seasonal use and the landlord is collecting more than one month’s rent as a security deposit and/or more than one month’s rent, the licensee would be required to verify that the property is registered as a “seasonal use dwelling registry” pursuant to the statute. If the property is not registered, the licensee may be liable for collecting more than one month’s rent as a security deposit or more than one month’s rent as an advance. These obligations are no different than a licensees responsibility to verify the legality of a rental property where permits are required to rent.
Questions about the amendments, HSTPA or other licensed activities should contact NYSAR’s Legal Hotline. The Legal Hotline is a free benefit to members of NYSAR and is available Monday-Friday from 9:00am-4:00pm at 518-436-9727.
New amendments to NY CLS Gen Obligations Law § 7-108
1-a(a) No deposit or advance shall exceed the amount of one month’s rent unless the deposit or advance is for a seasonal use dwelling unit as provided for in subdivisions four and five of this section.
4. A dwelling unit shall qualify as a seasonal use dwelling unit for the purpose of paragraph (a) of subdivision one-a of this section if it meets all of the following conditions:
(a) The lease expressly provides that: (i) the dwelling unit is registered as a seasonal use dwelling unit, indicating the local or county government agency with which it is registered; (ii) the occupancy of the tenant is only for seasonal use not to exceed one hundred twenty days or a shorter period provided for in the lease; and (iii) such tenant has a primary residence to return to, the address of which is expressly provided in the lease.
(b) Such dwelling unit is registered with the appropriate local government, county, or state registry as a seasonal use dwelling as provided for in subdivision five of this section.
(c) Such dwelling unit is not rented as a seasonal use dwelling unit for more than one hundred twenty days during each calendar year.
5. In order for a dwelling unit to qualify as a seasonal use dwelling unit for the purpose of paragraph (a) of subdivision one-a of this section, the local government with jurisdiction for building administration over such unit, the county in which such unit is located, or the state shall have adopted a seasonal use dwelling unit registry and such unit shall be registered by filing a copy of the seasonal use lease and such additional information as the local government, county, or state agency that administers such registry may require. Such local government, county, or state agency shall revoke the seasonal use dwelling unit registration of any dwelling unit that does not adhere to the conditions provided for in subdivision four of this section.
