Selling a Brooklyn Building with HPD/DOB Violations or Illegal Units

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Find Out Exactly What Is on Your Building

Most owners know there are “some violations” but not which ones, how old they are, or whether any carry money. Every buyer’s title company will pull these records, so it is better to see them first. All of the following are public and searchable by address or block and lot.

• HPDONLINE shows Housing Maintenance Code violations by class, plus complaints, litigation, registrations and any emergency repair charges.
• DOB BIS and DOB NOW show DOB violations, complaints, permits, stop work orders and the certificate of occupancy on file.
• OATH and DOF records show summonses, hearing results, unpaid penalties and judgments.
• The Department of Finance statement of account shows property taxes, HPD charges and other items billed to the property.
• Water and sewer account history, since unpaid charges can become liens.

Print or save what you find and give it to your attorney. Separate items that involve money owed from items that involve a condition to fix: they affect a sale differently.

HPD

How HPD Violations Work

HPD inspectors write violations after tenant complaints or inspections. Each is assigned a hazard class, and the class sets how quickly the owner must correct and certify it.

• Class A, non-hazardous: the longest correction period, measured in months.
• Class B, hazardous: a correction period measured in weeks.
• Class C, immediately hazardous: as little as 24 hours for most conditions, with specific periods for lead paint, mold, pests, window guards and self-closing doors, and no grace period for heat and hot water.

Correcting Is Not the Same as Clearing

A violation stays open on HPD’s record until the owner certifies the correction or HPD reinspects and dismisses it. Many Brooklyn buildings carry dozens of violations that were fixed years ago but never certified. Those can often be cleared through a dismissal request with a reinspection, for a fee. A false certification, meaning a certified repair that an inspector finds was not done, keeps the violation open and exposes the owner to penalties.

When HPD Does the Work

If an owner does not correct an immediately hazardous condition, HPD can send a contractor through its Emergency Repair Program and bill the property. Those charges appear on the Department of Finance statement, and past-due HPD charges constitute a tax lien that accrues interest. Buildings with many serious violations can also be placed in enhanced enforcement programs, and tenants can bring repair cases in Housing Court.

DOB & OATH

DOB Violations, OATH Summonses and ECB Judgments

DOB issues two broad kinds of enforcement. Some DOB violations are notices that a condition must be corrected. Others are summonses heard at the Office of Administrative Trials and Hearings, which replaced the old Environmental Control Board hearings; owners still call these “ECB violations.”

Two Separate Steps

Clearing an OATH-heard violation usually means resolving the penalty and proving the condition is fixed, typically by filing a certificate of correction with DOB. Paying alone does not close the violation, and fixing alone does not erase the penalty. Some violations can be cured before the hearing with no penalty. Missing a hearing generally results in a default with a much higher penalty.

When Penalties Go Unpaid

Unpaid OATH penalties become judgments that the Department of Finance collects. Interest accrues until they are paid, and certain DOB judgments can be converted into tax liens that appear on the property’s tax bill. Open DOB violations can also complicate new permits, which matters for any buyer planning work.

Stop Work and Vacate Orders

A stop work order freezes construction until the issue is resolved, often requiring revised plans, new permits and penalties. A vacate order, whether from DOB or HPD, is the most serious situation: occupants must leave, relocation costs can fall on the owner, and the building cannot be reoccupied until the condition is cured. Both are buyable situations, but they need to be understood before a contract is signed.

Certificate of Occupancy

When the C of O Doesn’t Match the Building

The certificate of occupancy states a building’s legal use and number of units. A new or amended certificate is required when the use, egress or type of occupancy changes. Many Brooklyn brownstones and rowhouses were built before 1938 and never needed one; for those, DOB can issue a Letter of No Objection confirming the legal use, unless later alterations changed it.

Why It Matters for a Sale

• Lenders and appraisers generally value a building by its legal unit count, not the number of doorbells.
• A building with three or more households can be treated as a multiple dwelling, and New York’s Multiple Dwelling Law can bar an owner from collecting rent where occupancy is not permitted by a valid certificate.
• Title insurers may raise exceptions for uses the certificate does not allow.
• Getting an amended certificate requires plans, permits, inspections and generally clearing open violations on the property.

Mixed-use buildings on commercial avenues, former industrial lofts in Gowanus and East Williamsburg, and converted two-families in Bushwick and East New York are where we see mismatches most often. Confirm with an architect or expediter before assuming what your building’s legal use is.

Illegal Units

Illegal Basement, Cellar and Extra Units

Brooklyn has a large number of basement and cellar apartments that were never approved, along with attic units and extra apartments carved out of one- and two-family homes. Many have housed tenants for years. They create real exposure for an owner: fire and egress risk, flood risk in basements, DOB penalties and possible vacate orders.

The Basement Legalization Pilot

As part of City of Yes for Housing Opportunity, Local Law 126 of 2024 created a pilot that allows certain existing basement and cellar units in one- and two-family homes to be legalized without penalty, under a temporary residence authorization while the owner completes the work. It applies only to units that existed before April 20, 2024, only in specific community districts named in the law, and not in flood-prone areas. Units must meet basic safety standards, and the application window runs through April 2029. Proposed rules were published in late 2025; check DOB’s website for current status before relying on it.

Tenants in an Illegal Unit

A tenant in an illegal apartment still has rights, and removing one can require a court case. Do not simply change the locks. Many owners decide the cleanest route is to disclose the unit, price it honestly and sell to a buyer equipped to legalize, reconfigure or remove it lawfully. City of Yes also opened new paths for accessory dwelling units, which may matter for a buyer’s plan.

Liens & Closing

What Has to Be Paid at Closing

The key distinction is between a violation, which is a record of a condition, and a lien, which is a claim against the property for money. At a New York closing, the buyer’s title company lists both and requires liens to be satisfied.

• Typically paid from proceeds: property taxes, water and sewer charges, HPD repair charges and any judgments that have become liens.
• Typically negotiated in the contract: who corrects or clears open violations, and whether the seller pays a credit or the buyer takes the building as-is.
• Often cleared before closing: outstanding OATH penalties against the seller, so they do not follow the seller after the sale.

Many standard New York residential contracts require the seller to deliver the property free of violations, sometimes up to a dollar cap. An as-is contract shifts that burden to the buyer. Read the violations clause carefully with your attorney: it is often the most important paragraph for a building like yours.

Disclosure

What You Must Disclose

For one- to four-family homes, New York’s Property Condition Disclosure Act requires most sellers to give the buyer a disclosure statement before the buyer signs a contract. Since March 2024, sellers can no longer opt out by giving a credit at closing, and the form now includes flood history questions. Certain transfers, including some by estate fiduciaries and foreclosing lenders, are exempt.

For larger buildings, there is no state form, but that is not a license to stay silent. Selling as-is generally protects you from claims about conditions the buyer could discover. It does not protect you from actively concealing a known problem or misrepresenting the legal unit count or rent roll. The safest course is simple: tell the buyer what you know, in writing, and let them price it. We would rather know about a problem than discover it later.

Please note: this guide is general information, not legal advice. Violation, permitting and disclosure rules change and depend on the building, so consult a real estate attorney, and an architect or expediter where code questions arise.

Your Options

Fix First, List As-Is or Sell Direct

Clear Paper Violations and Then List

If your violations are mostly old, already-corrected items and the certificate matches the building, it is often worth clearing them, paying any judgments and listing with a broker. A clean municipal search widens the buyer pool, including buyers who need financing, and is likely to bring a better retail price.

List As-Is With a Broker

Listing as-is can work for buildings with moderate issues, but expect investor buyers, retrades after inspection and financing problems for anyone using a bank loan. Factor in the time a deal can take to fall apart and restart.

Sell Direct to Red Hook Development

Selling to us makes sense when the problems are real: illegal units, stop work orders, a vacate order, heavy Class C violations, accumulated judgments, or a certificate that would take a year of plans and permits to fix. Our price accounts for the cure, so it will reflect that work. In exchange there is no repair spending, no financing contingency, no retrade over things we already know about, and a closing date you choose. We also buy rent-stabilized buildings and 421-a buildings; see everything we buy.

How It Works

How We Buy Buildings With Violations

• Send the address. We pull HPD, DOB, OATH and Finance records ourselves.
• One walkthrough. We look at the conditions behind the violations and any unapproved units.
• Written cash offer. We show you which items we priced in, so there are no surprises later.
• Attorney-driven contract. As-is terms, with liens paid from proceeds at closing.
• Close on your schedule, with tenants in place if needed.

We buy problem buildings across the borough, including Bedford-Stuyvesant, Crown Heights, Flatbush and Sunset Park. Start with the quick form above or our detailed property form.