Across major U.S. markets, elevated amounts of vacant space in office and some industrial markets present tenants with leverage to negotiate favorable lease terms. However, the window to capitalize on market dislocation may be closing.
“Layoff plans fell last month, certainly a positive sign. That said, job cuts in November have risen above 70,000 only twice since 2008: in 2022 and in 2008.
Increasing the exemption from 50% to 65% could translate into savings of up to $300 annually for the average senior.
The program could convert thousands of currently unpermitted basement units into legal Ancillary Dwelling Units (ADUs).
The Adams Administration has released proposed rules that would launch a new pilot program to legalize existing basement and cellar apartments in one- and two-family homes—an initiative that could directly impact property owners, small landlords and the broader housing market.
With New York City’s vacancy rate at 1.4%, thousands of households rely on informal basement units. This pilot program created under Local Law 126 of 2024, is designed to bring those units into compliance safely while keeping eligible tenants in place.
The program could convert thousands of currently unpermitted basement units into legal Ancillary Dwelling Units (ADUs), increasing available housing options in neighborhoods with extremely limited supply.
Participating homeowners can legalize existing units without penalties if they meet milestone requirements over a 10-year timeline. Once fully legalized with an amended Certificate of Occupancy, these units can significantly enhance property value and rental income opportunities.
Units must:
Tenants living in these units as of April 20, 2024, will receive a right of first return if temporary relocation is needed for safety-related construction. Owners must provide clear written notices, timelines and a lease upon return.
Legalization will require improvements, such as sprinklers and flood-water sensors—key points to flag for clients considering participation.
Upcoming Public Hearings
Realtors should be aware that final rules will shape how owners can navigate compliance and how these units may enter the market over the next decade.
As New York City continues to push forward on ADUs as a tool for housing supply, we will stay closely engaged and provide updates on how this impacts transactions, valuation, and homeowner advisory conversations.
About the author: Dr. Jermaine Meadows is the Director of Government Affairs for the Bronx and Manhattan for the Hudson Gateway Association of Realtors.
One of the key pieces of legislation discussed was Intro 1120, sponsored by Councilmember Julie Farías, that would establish clear timelines for cooperative boards to process, review, and issue decisions on co-op purchase applications.
HGAR’s Orange County Day featured a Legislative Power Hour with County Executive Steve Neuhaus, who addressed a packed room with his trademark energy.
New York’s housing ecosystem is at an inflection point. Affordability pressures, development bottlenecks, small-property owner challenges, regulatory changes, and aging housing stock are all converging at the same time.
Owners who delegate rent-setting to third-party property managers, real estate brokerage firms and brokers that also offer property management services, or owners who use national “revenue management” platforms should review and update their contracts well before the Dec. 15, 2025, effective date.
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