The New York real estate landscape has shifted dramatically over the past year. Between the fallout of national commission settlements and New York’s aggressive legislative agenda for 2026, agents must distinguish between what is already "the law of the land" and what is currently making its way through Albany.

Part 1: Passed Laws (In Effect or Pending Effective Date)

These items have already been signed by Governor Hochul or codified by the Department of State. Compliance is no longer optional.

1. The Institutional Investor "90-Day Rule"

The Law: Part of the FY 2026 Budget, this law disincentivizes large entities (owning 10+ homes and managing $30M+ in assets) from "buying up" the market.

The Impact: Covered entities are barred from offering on a 1- or 2-family home until it has been on the open market for 90 days.

Penalty: Up to $250,000 per violation. Agents must ensure they are properly vetting "all-cash" entities to avoid facilitating a prohibited sale.

2. Extended License Revocation (A5169)

The Law: Effective late 2025, the "time-out" period for a revoked license has tripled.

The Impact: If a broker or salesperson’s license is revoked, they are now ineligible to re-apply for three years (up from one). Furthermore, all suspension and revocation histories are now permanently searchable on the data.ny.govpublic portal.

3. All-Electric New Construction (Local Law 154 / State Equivalents)

The Law: As of January 1, 2026, most new construction buildings seven stories or shorter must be all-electric. The implementation of this law is still on hold as of 1/14/2026.

The Impact: Gas hookups are no longer permitted for heating or appliances in these new builds. Agents selling "new construction" must be prepared to explain electric heat pump technology and induction cooking to skeptical buyers.

Part 2: Pending Legislation (The 2026 Watchlist)

These bills are currently active in the 2025-2026 Legislative Session. We have included their current status and a "Likelihood of Passage" based on sponsorship and political climate.

1. The Two-Year Listing Limit (S7499)

The Proposal: Prohibits residential listing agreements from lasting longer than two years and bans automatic renewal clauses.

Likelihood of Passage: HIGH (80%)

Why: There is strong bipartisan support for "consumer control." Many legislators view long-term, "locked-in" contracts as predatory. Expect this to become law by the end of the 2026 session.

2. Formalized Broker Supervision Duties (A5164)

The Proposal: Explicitly defines "adequate supervision" to include regular, personal guidance and the review of all transaction documents by the Principal Broker.

Likelihood of Passage: VERY HIGH (90%)

Why: This is a Department of State priority. Following several high-profile fair housing violations, the state wants a clear "paper trail" showing that brokers are actually training their agents.

3. Ground Lease Rent Caps (S2433A)

The Proposal: Limits rent increases for residential co-ops built on leased land to 3% or the CPI (whichever is greater).

Likelihood of Passage: MODERATE (50%)

Why: This is a "hot-button" issue in NYC, where several co-ops face insolvency due to ground lease resets. While it has strong tenant-advocacy backing, it faces stiff opposition from land-owner lobbyists.

4. Short-Term Rental Property Commission (A4568)

The Proposal: Establishes a state commission to study the impact of Airbnbs on housing stock and create "model local laws" for all NY municipalities.

Likelihood of Passage: HIGH (75%)

Why: Unlike the strict NYC ban, the state wants a "study-first" approach to help upstate and suburban areas regulate STRs without killing local tourism.

Special mention - Mandatory Written Buyer Agreements for members of NYSAR

Although not a NYS law, the New York State Association of Realtors (NYSAR) is following the the National Association of Realtors (NAR) and is complying with the terms and conditions of the NAR legal settlement.

The Impact: If you are a member of NYSAR (this applies to the vast majority of residential sales professionals) must have a signed representation agreement before or immediately after the first property showing. The agreement must clearly state that commissions are negotiable and cannot be "pre-set" by law or MLS policy.Written by:

Christopher Robson
Licensed Real Estate Broker
Educators Realty
Molloy University Real Estate Faculty
(516) 459-9564
chris@educatorsrealty.com