It’s usually accepted that the tenant of a rent-stabilized or rent-controlled apartment is entitled to a lease renewal at the end of each term. However, as with most things, there are exceptions. One of these being if the owner intends to occupy the apartment as their primary residence. This is known as Owner Occupancy Destabilization. Through this, the owner of an apartment can recover possession of rent stabilized or rent controlled apartment. But to do this, you will need to meet certain conditions. Read on to learn about how owner occupancy destabilization works.

What is owner occupancy destabilization?

Under section 2524.4 of the Rent Stabilization Code (RSC), a building owner can refuse lease renewal if they wish to occupy the space for themselves.  The owner must give notice of their intent between 90 and 150 days prior to the expiration of the current lease. If the owner fails to serve a non-renewal notice within that time they must offer a renewal lease.

The only exception to this is in the case of a rent-controlled apartment where there is no renewable lease. In that case, the owner only has to serve a 30-day notice of tenancy termination.

Requirements for owner occupancy

The owner must meet some basic requirements for owner occupancy to be permissible. These being as follows:

Requirement 1: Not a corporation or partnership

The RSC section 2524.4(a)(3) states that only an “individual owner” can bring a case based on owner occupancy. This means that they cannot be a corporation. In the case of a partnership, only one of the individual owners may recover possession of one or more apartments for personal use and occupancy. If you currently own a building through a corporation or partnership, you can file to change this to individual ownership.

Requirement 2: Occupancy by the owner or immediate family

The owner must prove that they, or a member of their “immediate family” intends to live in the apartment for at least three years. An owner’s “immediate family” is defined as either their wife, husband, daughter, son, stepdaughter, stepson, mother, father, mother-in-law or father-in-law.

If on recovering the apartment, the owner or a member of their immediate family does not reside there for three years as their primary residence, they may lose the right to any rent increases in that building for three years. Failure to do this could also jeopardize any attempts on owner occupancy in the future. Which brings us to the third requirement.

Requirement 3: Owner is acting in “Good Fate.”

New York’s highest court defines good fate as “the honest intention and desire to gain possession of the premises for one’s own use.” If the court believes your claim to occupy the apartment, then it will find good fate. It is up to the owner how they prove this. For example, if they have plans for renovations they should show that they have an architect and contractor lined up for the remodeling. Detailed plans for the remodeling and proof of funds to cover the renovations should also be presented.

Tenant defenses against owner occupancy

Even if the above requirements are all met, special rules exist to protect senior citizens, the disabled and long-term tenants. You cannot evict a tenant from a rent-stabilized apartment in NYC if they are a senior citizen. This being anyone aged 62 or older and includes their spouse as well. The same is true for a disabled person and anyone who has occupied the apartment for 20 years or more.

There is only one way the owner can get around these restrictions. That is if they can provide an equivalent or superior apartment at the same price or lower and in the nearby area.

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