Massachusetts Rental Law Update: Boston Property Owners and Broker Fee Changes
Effective August 1, 2025, Massachusetts landlords can no longer require tenants to pay rental broker fees unless the tenant hired that broker directly. For Boston property owners who have relied on tenant-paid fees for decades, this represents a fundamental shift in operations.
This article outlines what’s changing, how it affects your properties, and what PropertyCraft is implementing to keep you compliant and profitable.
Heading: What the New Law Actually Says
Under M.G.L. c. 112 §87 DDD½, real estate licensees can only collect fees from the party that hired them directly. The key changes:
No more dual agency—brokers can only represent one side (i.e., "split fee" arrangements are prohibited.)
Landlord brokers cannot collect any fee from tenants
Tenant brokers cannot collect any fee from landlords
It is illegal to advertise a unit with a “tenant-paid fee.” MLS has deactivated this option.
Marketing through third-party platforms needs careful structuring to stay legally compliant
Bottom line: if you hire the broker, you pay the broker.
What’s Already Happening in the Boston Rental Market
The market is reacting quickly:
Rent increases are already being observed in listings for August and September to offset the shift to owner-paid leasing fees. In NYC, after a similar law was enacted, rents increased 5.3% on average.
Small and mid-sized landlords are restructuring operations in how they handle leasing, pricing, and turnovers.
Tenants are becoming more price-sensitive, especially as of July 2025. Renters are beginning to expect fee-free leasing and may ignore units priced higher to absorb leasing commissions.
This brings Boston in line with cities like San Francisco, Chicago, and even Fall River, where landlords have always paid broker fees.
What Landlords Need to Recalculate
Leasing Costs - Expect to pay a leasing commission. A one-month rental commission is equal to 8.3% of a unit's annual revenue. If you have regular turnover, this hits your NOI harder.
Turnover Budgeting - Vacancies now cost more. Budget for brokerage fees in addition to lost rent, cleaning, repairs, and marketing time.
Pricing Strategy - Raising rent to offset broker costs could backfire if your pricing overshoots market demand. Winter vacancies (October–February) often lead to costly reductions. Data-driven pricing is now essential.
Compliance and Legal Risk - All marketing, advertising, and lease agreements must reflect the law. Errors could result in fines or litigation.
Landlord Takeaways
Prioritize thorough tenant screening. With sealed eviction records and higher leasing costs, confident approvals matter.
Focus on tenant retention through communication, maintenance, and updated finishes.
Lean on experts as Massachusetts fosters a challenging legal environment for landlords.
Be Prepared with PropertyCraft Management
✅ Adaptive Leasing Approach. We employ a combination of in-house agents, established external brokers, and technology solutions including self-guided tours, tailored to each property's specific requirements. This appropriately scales costs to the property’s needs.
✅ Technology-Forward Tools (Including Self-Showings). We deploy self-guided lockbox tours, video virtual tours, and digital scheduling tools that enable prospects to view units during optimal times like evenings and weekends. Benefits:
Faster time-to-lease
More qualified leads
Lower staff overhead
✅ Retention-Focused Management. Every lease we renew saves thousands in leasing costs. Our proactive resident care strategy includes:
Preventative maintenance
Consistent communication
Clear onboarding and move-out expectations
Resident follow-ups to ensure satisfaction
✅ Strategic Renewal Program. Not all units should be treated the same. Based on your building, unit mix, and goals, we design custom renewal strategies that balance stability with rent growth.
✅ Market-Responsive Pricing & Listings. We analyze comps and absorption trends weekly. Listings are distributed to high-visibility platforms with compliant language and optimized pricing.
✅ Comprehensive Regulatory Compliance. Our materials, listings, and broker processes adhere to current Massachusetts regulations while maintaining positive relationships with prospective tenants.
The Current Reality: Property Ownership Complexity Has Increased
Whether transitioning from self-management or upgrading from traditional broker relationships, the leasing landscape has fundamentally changed. Proactive landlords are implementing adaptations now. Those who delay risk extended vacancies, tenant dissatisfaction, and regulatory complications. At PropertyCraft, we assist owners in navigating these transitions with confidence. From pricing and leasing strategy to compliance management—we are already executing these solutions.
Let’s Optimize Your Leasing Strategy NOW
Schedule a complimentary leasing and pricing review today. Let us show you where to save, where to upgrade, and how to protect your returns.
PropertyCraft Management
Building Value. Crafting Peace of Mind.
Sources / Additional Reading - External Links
* Masslandlords: “Broker Fee Ban” Signed into Law via Budget; Zillow Application Fees Apparently Banned
* Greater Boston Real Estate Board (GBREB): Broker Fees in Residential Rentals
* Charlesgate Properties: Everything You Need to Know About the End of Tenant Paid Broker Fees