Final answer:
Current leases are transferred to the new owner when an apartment building is sold, and the new owner must honor these agreements. However, factors like price ceilings can affect the quality of housing and the decisions landlords make about property conversions or maintenance.
Step-by-step explanation:
Under general contract law, when a residential apartment building is sold, the current lease agreements are typically transferred to the new owner and remain in effect. This means that the new owner becomes the landlord and must honor the terms of the existing leases. The tenants continue to have the same rights and obligations as set forth in their leases, and any provisions like termination rules, possession rights, and liabilities still apply as agreed originally.
However, circumstances such as price ceilings can impact the situation for both landlords and renters. While price ceilings may allow some renters to have access to more affordable housing, it can also lead to potential downsides. For example, landlords might convert apartments to co-ops or condos, spend less on maintenance, or provide lower quality housing due to the reduced revenue.