05/01/2025
🏡 NYC Housing Legal Question
🔥 Topic:
Question:
Landlord’s Duty to Mitigate Damages
Question: a landlord had a tenant vacate an apartment before the lease expired. Once the tenant returned the keys, the landlord called me to discuss the possibility of listing the apartment for rent. What are the landlord’s obligations with regard to mitigating damages under the Housing Stability and Tenant Protection Act (“HSTPA”)?
Answer: Under the HSTPA, a landlord has a duty to mitigate damages once a tenant has vacated the premises—that is, moved out and returned the keys—prior to the lease’s expiration. This means the landlord cannot simply leave the apartment vacant without making a good-faith effort to re-rent it before the lease term ends.
Real Property Law Article 7 Section 227-E states:
“ … if a tenant vacates a premises in violation of the terms of the lease, the landlord shall, in good faith and according to the landlord's resources and abilities, take reasonable and customary actions to rent the premises at fair market value or at the rate agreed to during the term of the tenancy, whichever is lower.”
Importantly, this obligation to mitigate damages begins only after the tenant has vacated and returned possession of the unit; the landlord is not required to assist in re-renting the apartment before that point.
Additionally, the law provides that:
“If the landlord rents the premises at fair market value or at the rate agreed to during the term of the tenancy, the new tenant's lease shall, once in effect, terminate the previous tenant's lease and mitigate damages otherwise recoverable against the previous tenant because of such tenant's vacating the premises.”
However, if the landlord makes a good-faith effort and takes reasonable and customary steps to re-rent the apartment but is unsuccessful, the vacating tenant remains liable for rent through the end of the original lease term.
Important Tips: Any lease provision that attempts to exempt a landlord from the duty to mitigate damages is void as a matter of public policy.
A real estate agent should not provide any legal advice to the landlord. The landlord should speak to their own attorney about how to deal with the tenant, the issue of mitigation, and how to proceed in general.
🚃 provided by
Neil B. Garfinkel
~ REBNY Broker Counsel, Partner-in-charge of real estate and banking practices at Abrams Garfinkel Margolis Bergson, LLP
Thank you,
anne
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Anne Chang
Founder & Principal
玉石不動產顧問
JadeStone Real Estate Consulting
1460 Broadway, 11FL; NYC 10036
917-810-8592 (O) 917-494-0531 (M)
[email protected]
www.JadeStoneNYC.com
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