T
he Real Estate Board of New York (REBNY) is appealing a federal judge's decision to uphold the FARE Act, which requires landlords to pay commissions for brokers they hire. REBNY argues that the law violates the First Amendment and state law, while also claiming it preempts existing contracts.

    Judge Ronnie Abrams dismissed REBNY's motion for a preliminary injunction in February, finding that the trade group primarily objects to the law as "bad policy." However, she allowed one of REBNY's claims to move forward, which alleges that the law wrongfully interferes with existing contracts.

    REBNY is taking its appeal to the U.S. Court of Appeals for the Second Circuit after Judge Abrams' decision. The FARE Act went into effect this week, requiring landlords to pay brokers they hire, and REBNY claims it will lead to higher rents, reduced choice for tenants, and a less transparent rental search process.

    The law has already had an impact, with thousands of listings removed from platforms in just 48 hours. REBNY President Jim Whelan stated that the group is continuing its fight against the FARE Act, which he believes will result in policy whiplash for tenants and owners as they navigate the new commission landscape.