In the United States Court of Appeals For the Second Circuit ________

AUGUST TERM 2024

ARGUED: FEBRUARY 4, 2025 DECIDED: JUNE 2, 2025

No. 24-1678 HUDSON SHORE ASSOCIATES LIMITED PARTNERSHIP, HAVEN ON THE HUDSON LLC, KENNETH LEVINSON, AND HUDSON VALLEY PROPERTY OWNERS ASSOCIATION, Plaintiffs-Appellants,

v.

STATE OF NEW YORK, NEW YORK STATE DIVISION OF HOUSING AND COMMUNITY RENEWAL, VILLAGE OF NYACK, NEW YORK, AND CITY OF POUGHKEEPSIE, NEW YORK, Defendants-Appellees. ________

Appeal from the United States District Court for the Northern District of New York. ________ Before: WALKER, LEVAL, AND BIANCO, Circuit Judges. ________

New York State has contended for decades with a scarcity in affordable rental housing. It has deployed varying forms of rent 24-1678-cv regulation to tackle this problem, most prominently a scheme known as “rent stabilization,” which it first adopted in 1974. Rent stabilization caps annual rent increases, aiming to ameliorate the situation in which low vacancy rates empower landlords to raise rents above levels that would be competitive in a market with sufficient supply. For most of its existence, rent stabilization has been available only to New York City and certain other downstate municipalities with particularly tight housing markets.

In 2019, the State amended its rent stabilization law to allow any municipality to regulate rents upon (1) finding a vacancy rate of five percent or less among its rental housing stock; and (2) declaring a housing emergency. To calculate their vacancy rates, local governments sent surveys to landlords requesting rent rolls and other relevant information. These governments were stymied, however, by landlords who ignored their requests or provided false information. In 2023, the Legislature responded by further amending the law to authorize local governments to impose civil penalties on uncooperative landlords and presume from the lack of such cooperation that they have zero vacancies (the “Vacancy Provisions”). N.Y. Unconsol. Law §§ 8623(d)–(f) (McKinney 2025).

Plaintiffs-Appellants are an association of landlords and individual property owners (the “Landlords”) in New York’s Hudson Valley region who have been surveyed by municipalities conducting vacancy studies. They sued the State, a State housing agency, and two municipalities—Nyack and Poughkeepsie—seeking preliminary and permanent injunctions and a declaratory judgment nullifying the Vacancy Provisions as unconstitutional on their face. The Vacancy Provisions are unconstitutional under the Fourth Amendment, the Landlords allege, because they authorize warrantless searches of their

2 24-1678-cv records without providing an opportunity to challenge the searches’ scope. They also allege that the Vacancy Provisions violate procedural due process under the Fourteenth Amendment by preventing landlords from contesting local governments’ vacancy calculations. The United States District Court for the Northern District of New York (Kahn, J.) denied the preliminary injunction and dismissed the complaint for failure to state a claim. The Landlords appealed.

We find that there are sufficient opportunities for landlords to challenge records demands and vacancy calculations to enable the Vacancy Provisions to pass constitutional muster. Specifically, we hold that (1) t