Hoboken Legal Beagle – 12/9/2008
Today, a simple inquiry as to what might happen to a rent-controlled building after a fire.
Rent controlled buildings and fires
“If an apartment building is under rent control – and a fire takes place, what is the official law in Hoboken if the building is rebuilt – and the original tenants want to remain?
If insurance pays for the renovations, shouldn’t it remain rent-controlled until they decide to move out?”
Hoboken411 Legal Beagle says:
As with everything, it depends on the facts, if the building is totally destroyed or bad enough to be eligible for a gut rehab, as defined by the rent control ordinance, the units would be decontrolled and the first rents would establish the new base rent for rent control.
However, if the units were not that destroyed, for example with only smoke and water damage, then the rents would not get decontrolled but the landlord may be eligible to get a hardship rent increase. In most cases, where the damage is not extensive, the tenants would be offered the right to come back into the unit. Also rent control would remain even if the displaced tenants did not rerent the units. In order to decontrol the rents the Landlord would have to go to the rent board and request the decontrol, it would not be automatic.
By the way, Insurance payments, in and of themselves, would not be determinative of what rent the Landlord could charge.