Apartment Was Properly Vacancy-Deregulated Before June 14, 2019

Tenant complained to the DHCR in 2020 of rent overcharge and unlawful apartment deregulation. Landlord claimed that the former rent-controlled tenant moved out in 2002, that landlord then performed $45,500 in individual apartment improvements (IAIs), that when prior tenant moved into the unit on May 1, 2022, the rent was above the $2,000 vacancy deregulation threshold, and that the apartment therefore was properly deregulated before tenant later moved in. The DRA ruled against tenant, finding that the base date was June 14, 2015, that the lawful rent exceeded the $2,000 deregulation threshold in 2002, and that the apartment was legally deregulated before tenant moved in.

Tenant appealed and lost. Under the law in effect in 2002, landlord could deregulate an apartment when it exited rent control if the rent exceeded the deregulation threshold. Landlord showed that an IAI rent increase pushed the legal rent over the deregulation threshold. Tenant didn't establish a colorable claim of fraud that would require investigation of rental events from over 20 years ago. And, under HSTPA, apartments lawfully deregulated prior to June 14, 2019, remained deregulated.

Leavitt: DHCR Adm. Rev. Docket No. LV410006RT (2/5/24)[2-pg. document]