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ARTICLE · 19 DECEMBER 2025

New York's Prohibition On Algorithmic Rental Pricing Programs Goes Into Effect

Herbert Smith Freehills Kramer LLP
Herbert Smith Freehills Kramer LLP
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On December 15, 2025, Section 340-B of New York's General Business Law became law. Under the statute, it is illegal for owners and managers of residential property in New York state to utilize artificial intelligence...

United StatesReal Estate and Construction
Abbe Dienstag
Abbe Dienstag
Jay A Neveloff
Jay A Neveloff
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On December 15, 2025, Section 340-B of New York's General Business Law became law. Under the statute, it is illegal for owners and managers of residential property in New York state to utilize artificial intelligence (AI)-driven algorithmic programs to set rents or other terms of residential leases. The statute also makes it unlawful for anyone to facilitate an agreement among residential property owners or managers not to compete by licensing software that performs a coordinating function.1

Background

The use of AI-driven algorithmic programs to set rents and other leasing terms for residential properties has been a concern across the United States for some time. Ordinances prohibiting the use of such programs have been enacted by various municipalities, including Philadelphia; Minneapolis; Portland, Oregon; San Francisco; and Santa Monica, California. These programs have also been in the crosshairs of the federal antitrust agencies. The Department of Justice

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