New York Real Estate Salesperson ExaminationNew York State Specific Laws and RegulationsMedium
A tenant in a rent-controlled apartment in New York City is paying $800 per month. The landlord applies to the New York State Homes and Community Renewal (HCR) for an increase due to a major capital improvement (MCI) in the building. The HCR approves an MCI increase of 6% of the current rent. What will be the tenant's new maximum monthly rent?
- A$806.40
- B$840.00
- C$864.00
- D$848.00
Show answer & explanationAnswer & explanation
Correct answer: D. $848.00
The MCI increase is calculated as 6% of the current rent. So, 6% of $800 is $800 * 0.06 = $48. The new maximum monthly rent will be the current rent plus the MCI increase: $800 + $48 = $848.
Why the other options are wrong
- A. This calculation is incorrect and doesn't reflect a 6% increase.
- B. This implies a 5% increase, not 6%.
- C. This implies an 8% increase, not 6%.
Rent Control MCI Increase
Under New York's rent control laws, landlords can apply for rent increases based on approved Major Capital Improvements (MCIs) to the building, with the percentage of increase determined by the HCR.
- Requires HCR approval.
- Applies to rent-controlled and rent-stabilized units.
- Calculated as a percentage of current rent.
Memory trick: Major improvements mean major adjustments to your rent.