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Legal rent vs. preferential rent

Posted by Rachel on August 01, 1997 at 17:38:54:

I have reason to believe that I am being overcharged on my rent, but my lease and the printout I got from the DHCR is confusing at best. Here's the situation:

1. A broker took me to see this apartment in September of 1994. It was listed for $1300. I made an appointment with the landlord to sign the lease. The afternoon before I was to sign the lease, the broker called me and said the landlord now wanted to raise the rent to $1350. Since I was desperate, I said okay, but I did think it was a little fishy.

2. A little background: Around 1988 or 1989, this building was put up for auction, which is when the current owner purchased it. Somewhere in the dim recesses of my memory, I think I remember hearing something about this affecting the amount of rent charged. This building is also subject to something called an escalator clause, allowing the landlord to charge me an additional 2.2% of the initial rent. I'm unclear about whether or not this is the charge allowed by Real Property Tax Law Section 421-a, or something else entirely.

3. Anyway, I renewed my lease in October 1996 for the "preferential rent" amount of $1507.45. The lease renewal stated that the legal regulated rent for this apartment was $2076.09.

4. My lease renewal for October 1997 claims a legal rent of $2179.89, and a preferential rent of $1751.97.

5. Here's my dilemma: my landlord is the most curmudgeonly, hostile, miserly person I know. I find it difficult to believe that he would charge me a penny less than the law said he could, not only because he's just not that kind of guy, but also because he and I are in court over a non-payment proceeding. In fact, I was in court with him today to vacate a 72 hour notice of eviction. Now we're disputing the amount in arrears, but that's another story.

6. Clearly, he's not charging me a preferential rent because he loves me. Moreover, this apartment is a studio--in a luxury building, but a studio no less. If the legal rent is in fact $2179, it seems awfully high considering comparable apartments are renting for $1300-$1500.

7. Not only that, but I know of another tenant in my building who took him to court over rent overcharges, and won--to the tune of tens of thousands of dollars.

8. The DHCR's records are somewhat confusing, but their figures are in accordance with the ones on his lease. What's puzzling is that their records seem to show that the apartment was vacant September 1989 to July 1990, and again from July 1991 through November 1992. Also, in July 1990, the "legal" rent dropped from $1400 to $1300, shooting up to $1645 in the next registration year.

Am I missing something here? And why would a landlord (especially this one) charge a tenant he was trying to evict a preferential rent?

I realize that this is incredibly long and rambling, but any info would be appreciated. Thanks.

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