The vacancy bonus, in one paragraph
From 1997 through June 2019, New York rent law gave landlords a substantial “vacancy bonus” on every vacancy in a rent-stabilized apartment. The bonus was 20% of the prior legal rent, and a smaller additional amount based on how long the previous tenant had stayed. So a $1,500/month stabilized apartment became a $1,800+/month apartment the moment the prior tenant moved out — before any improvements, repairs, or anything else. Stacked across multiple vacancies, the math compounded fast.
Why it became the deregulation lever of choice
Through that same window, the law also had a “high-rent vacancy decontrol” rule: when an apartment's legal rent crossed a threshold (most recently around $2,775/month) at the time of a vacancy, the unit was permanently removed from rent stabilization. The vacancy bonus was the mathematical lever that pushed apartments over that threshold. A $2,200/month stabilized apartment that “turned over” one summer became a $2,640/month apartment by the bonus alone — and if the landlord layered an inflated IAI charge on top, it crossed $2,775 and escaped stabilization permanently.
Because every vacancy was an opportunity to raise the rent and creep toward deregulation, landlords had a strong financial incentive to create vacancies — pressuring tenants to move out, refusing repairs, or filing eviction proceedings on thin grounds. They also had an incentive to fabricate vacancies that didn't actually happen.
The patterns that show up in overcharge cases
- Stacked vacancies in short windows. An apartment that “turned over” three times in five years, each time with a 20% bump, with no corresponding lease records or DHCR registrations naming the intermediate tenants. The math compounds: $2,000 → $2,400 → $2,880 → $3,456 in three vacancies.
- Vacancy bonuses applied without actual vacancy. The current tenant signs a renewal lease, and the new lease shows a 20% increase labeled as a vacancy bonus. There was no vacancy. This is a straightforward overcharge.
- Phantom intermediate tenants. Registrations name a tenant for a six-month gap between two long-term tenancies — but the “intermediate tenant” cannot be located, has no public record, and never actually lived there.
- Long-tenancy bonus inflation. The longevity bonus for tenancies of more than eight years was claimed for tenants who hadn't actually been there that long, often based on a registration history that itself is fabricated.
- Bonus + IAI together to clear the threshold. The most common pattern: a 20% vacancy bonus plus a $40,000 IAI claim to push the rent from below $2,000 to above the deregulation threshold. Either one alone wouldn't do it. Together they cross the line.
What HSTPA changed
HSTPA (June 2019) eliminated the vacancy bonus entirely. There is no longer any automatic rent increase on a vacancy in a rent-stabilized apartment. Landlords can still take RGB-authorized renewal increases and properly documented IAI/MCI increases, but the “just because it's vacant” bump is gone. HSTPA also eliminated high-rent vacancy decontrol, so even if a rent did cross the old threshold, the apartment cannot be deregulated through the vacancy mechanism going forward.
What HSTPA did not do is reverse pre-2019 deregulations. An apartment that was pushed out of stabilization in 2017 through stacked vacancy bonuses and inflated IAI charges is not automatically restored. It takes a tenant complaint and DHCR review of the registration record. When the records don't hold up, DHCR will reverse the deregulation and order the rent rolled back.
The six-year overcharge lookback under HSTPA means an apartment deregulated in 2017 has substantial recoverable damages right now. The further back the deregulation, the smaller the still-recoverable window — but if you're currently paying a free-market rent on what the law says is a stabilized apartment, every month adds to the overcharge.
Signs your rent may have been inflated by vacancy bonus abuse
- Your rent jumped substantially when you signed your lease — and the prior tenant's tenancy was relatively short.
- The DHCR registration history shows multiple short tenancies in the years before yours.
- The bonus and an IAI claim both appear in the same vacancy that pushed your apartment past the old deregulation threshold.
- You can't find any record of one of the prior tenants named in the registration.
- Your building has visible signs of investor-driven turnover (renovation projects, new landlord LLC names appearing in deeds in the 2010s).
How the recovery works
We pull your apartment's registration history from DHCR and reconstruct the increase chain year by year. Where the math doesn't reconcile to lawful RGB increases, properly documented IAI claims, and verifiable vacancies, we flag the overcharge. We file the complaint (Form RA-89) with the documentary record. DHCR investigates, the landlord has 30 days to respond, the Rent Administrator issues an order. When the bonus claims don't hold up, the rent is rolled back to the last properly registered amount and the difference is recoverable for the six-year window — with treble damages where the abuse was willful.
The vacancy bonus is gone, but the overcharges it created are not. If your apartment was pushed out of rent stabilization through stacked, fabricated, or otherwise abusive vacancy bonuses, the deregulation is reversible — and the rent you've paid above the legal regulated amount is recoverable.