This piece appeared in the Real Estate Section of Sunday's New York Times
How Much More Can a Rental Cost?
By JAY ROMANO
Q I rent a condominium from its owner. We signed a one-year lease, with the tenant's option for the second year, with an increase. The owner now wants triple the amount of the increase. When I mentioned our signed lease, I was told that the market rate for apartments in the condo had gone up. Is it legal for the owner to raise the rent this high?
A Options to renew residential and commercial leases take on various forms, said Lucas A. Ferrara, a Manhattan real estate lawyer. If the agreement provided for a clearly defined increase and time frame, and there were no other conditions associated with the renewal, then a "deal is still a deal," and neither the landlord nor the tenant can readily renege on those terms. However, he said, problems arise when an option's terms are unclear, or when a critical factor, like the actual dollar amount of the renewal rent, is left for negotiation. In such instances, a court may find that no "true" option was reached and that the parties basically "agreed to agree" at some subsequent point. The landlord would then be free to charge whatever the market would bear.