What a preferential rent is
A preferential rent is a rent your owner agrees to charge that is lower than the legal regulated rent they could lawfully collect. Your lease shows both numbers. Before June 2019, owners could often drop the discount at renewal and jump straight to the legal rent. The Housing Stability and Tenant Protection Act (HSTPA), signed June 14, 2019, ended that for tenants in place.
How the calculator works
- It finds the Rent Guidelines Board order whose window contains your renewal start date (for example Order #58 for leases starting Oct 1, 2026 to Sep 30, 2027).
- New preferential rent = preferential rent × (1 + guideline %).
- New legal rent = legal rent × (1 + the same guideline %). This stays on your lease and registration but is not what you pay.
- The discount is the gap between the two. Because both rise by the same percentage, the dollar gap grows when increases are positive.
- The five-year projection repeats your chosen term at the percentage you enter for future renewals. Future board votes are unknown, so the default is 0%.
Worked example
HCR's own example: a lease effective October 1, 2018 showed a legal rent of $1,200 and a preferential rent of $1,000. The one-year renewal starting October 1, 2019 fell under Order #51 (1.5%). The legal rent rose to $1,218 and the preferential rent to $1,015. The tenant pays $1,015, not $1,218.
With this page's defaults (legal $2,600, preferential $2,100, one-year renewal starting November 1, 2026), Order #58's freeze applies, so both rents stay the same and you keep a $500 monthly discount, or $6,000 a year.
| Legal rent | You pay | |
|---|---|---|
| Current lease | $2,600.00 | $2,100.00 |
| Renewal, applied to the preferential rent (current law) | $2,678.00 | $2,163.00 |
| Increase per month | +$78.00 | +$63.00 |
Edge cases
- Late-payment clauses: an owner cannot enforce a clause that ends your discount because rent was late, or that requires a payment method such as electronic payment.
- Legal rent must be written down: to charge the old legal rent after you leave, the owner must have stated it in the lease where the preferential rent started and in every renewal. Registration alone is not enough.
- Regulatory agreements: some government-assisted buildings with project-based rental assistance are treated differently. Ask the agency that supervises the building.
- MCI and IAI increases are separate from the guideline and are not modeled here.
What to do if your renewal ignores your preferential rent
First, request your rent history from HCR (online, by appointment at a borough rent office, or with form REC-1). Then compare the registered rents with your leases. If the owner based the renewal on the legal rent, you can file a rent overcharge or lease violation complaint with HCR or go to court. The rent overcharge estimator shows roughly how much is at stake, and preferential rent in NY after the 2019 law covers the rule in more depth. To check a plain renewal, use the rent-stabilized renewal calculator.