Individual Apartment Improvements - Current IAI Tiers and Documentation

Overview

New York's 2024 housing-law changes took effect October 17, 2024 and created two methods for Individual Apartment Improvement rent increases.

Under Tier 1, an owner may recover up to $30,000 of eligible IAI cost over a 15-year period. The permanent monthly increase is 1/168 of eligible cost in a building with 35 or fewer apartments and 1/180 in a building with more than 35 apartments.

Tier 2 permits up to $50,000 only for qualifying vacant apartments and requires DHCR eligibility certification. The HCR guidance identifies qualifying vacancy-registration or 25-year prior-occupancy conditions. Its permanent amortization rates are 1/144 for buildings with 35 or fewer apartments and 1/156 for buildings with more than 35 apartments.

Required Control

Do not calculate or collect an IAI increase from this summary alone. Before work begins, use current HCR forms and operational guidance and have qualified counsel or the managing agent confirm:

1. the unit's regulatory status and available 15-year cap;
2. whether the work and cost are eligible;
3. whether Tier 2 eligibility exists and has been certified;
4. required notice, consent, filing, permits, photographs, invoices, and proof of payment; and
5. the correct building-unit count and amortization divisor.

HCR states that Tier 2 requires pre-work evidence of necessity, including photographs and necessary permits, and post-work evidence including photographs, itemized receipts, proof of payment, and a fee equal to 1% of claimed IAI costs. Current forms and later guidance control over this summary.

Corrected Calculation Examples

For an eligible $30,000 Tier 1 project, the maximum permanent monthly increase is $178.57 in a building with 35 or fewer apartments ($30,000 ÷ 168) or $166.67 in a building with more than 35 apartments ($30,000 ÷ 180).

For an eligible and certified $50,000 Tier 2 project, the maximum permanent monthly increase is $347.22 in a building with 35 or fewer apartments ($50,000 ÷ 144) or $320.51 in a building with more than 35 apartments ($50,000 ÷ 156).

These are arithmetic illustrations of the HCR formulas, not a finding that a particular project qualifies.

How Botway Handles This

Botway can retain owner-supplied renovation documents associated with a listing. It does not determine IAI eligibility, calculate a collectible legal rent, certify Tier 2 eligibility, or file an IAI. Those decisions remain with the owner, counsel, managing agent, and HCR process.

Verified Sources

• New York HCR, FY2024 housing-law changes - IAIs - fetched and read 2026-08-07.
• New York HCR, IAI and MCI Improvements - fetched and read 2026-08-07.
• New York HCR, Form RA-LR1 ETPA (10/2024) - fetched and read 2026-08-07.

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This article provides general educational information only and is not legal advice or a rent calculation. Current HCR rules and forms control.