Our Style Editor, Victoria de la Camara, is looking into the stressful and murky waters of renting an apartment in a competitive market. She sits down with real estate broker, Jimmi Circosta of Citi Habitats to get some insider knowledge.
I lived in New York City for five years – and like San Francisco, or LA – finding an apartment to rent, that is decent and within your budget, is the ultimate struggle. It’s an extremely competitive market, as well as one that has sky high prices. And the quintessential thing of every New Yorker is to change apartments often in search for one that is “perfect” – I lived in four different apartments in four years. And believe me when I say, that of the four times, the experience I had with Jimmi was night-and-day. Aggressive brokers, unresponsive brokers, sleazy brokers, I’ve seen them all.
That’s why I sat down with him to help shed some light into the madness that is renting an apartment in New York City.
Let’s start with working with a broker, or not. Why is hiring a broker a better idea than just looking on websites like Craigslist?
When a friend or colleague refers a broker to you, there’s a reason for it. In my case, I have 12 years experience and have many repeat and referral clients because I look after my clients’ best interests and work tirelessly to find them the best possible fit for their budget. I think a lot of websites are not giving you the current picture. Plus sites like Craigslist are notorious for unscrupulous brokers and landlords who post bogus ads trying to get their phones to ring. They will leave up outdated apartment listings or what I call ‘fantasy island’ listings where they are way too good to be true. When you call they say that one is rented, but I have this other one… That’s called “bait and switch” in our industry. You want your broker to be your advocate – and most importantly – to be honest with you from the get go.
That has happened to me so many times! It’s so disappointing because you thought you found the “one” online. Is there a difference in commission percentages between brokers when it comes to renting?
There is, but it is a bit complicated. The standard fee is 15% of the annual rent and if there are two brokerages on the transaction the brokers split the fee, you do not pay 2 fees equaling 30% of the annual rent. On some listings the owner will pay part of the fee, which is usually listed as “Low Fee” or all of the fee, that’s when you see listings posted as “No Fee”. But be aware that if the owner is paying the fee, typically the fee is factored into the rent. If you plan to stay put for a while it may end up costing you more in the long run because your rent starts higher. Therefore, your renewal increases will be based on the higher rent you are currently paying.
That makes sense! How do you know you have the right broker? There are lot of sleazy people in real-estate, it’s hard to figure out when you are in good hands…
Believe it or not dishonest brokers have helped my business over the years, because many apartment seekers do not look for personal referrals until they have a bad experience. Then they immediately ask their family, friends, and colleagues for a referral because they don’t want to make the same mistake twice.
Here are a couple things I would keep in mind:
- I recommend meeting the broker in their place of business to make sure they are a legitimate brokerage.
- Beware of brokers over selling themselves or the apartments. The best brokers want to know more about you and what you are looking for. They will ask you questions to help them find you the best apartment.
- Don’t let the broker talk you into the first listing they show you. Most likely they are lazy bullies. They will tell you it’s the best on the market and they do not have anything else even close to show you so you better move on it quickly. Unless of course you have seen others and know it’s the one.
- Never give anyone a deposit without being in their place of business and make sure you get a receipt. I would read the language on the receipt to clarify if the deposit is refundable or not. Most deposits are refundable if you are not approved by the landlord.
What should you do before you start looking for places?
First, I would ask family, friends and colleagues from the area for a referral and talk to a few people. See who you feel comfortable with and give it a shot. Here in New York City, sticking to one broker that you trust, will pay off considering most of us have access to the same listings. I would also ask what the requirements are and what paper work is necessary to sign a lease and then be sure to come in prepared. In NYC, it is standard for the landlord to ask for a variety of documents that prove you can afford the apartment. Typically, most landlords want applicants to show income equaling 40 times the monthly rent. If not, they may require someone to act as a guarantor – or co-signer – on the lease who will be responsible if you are unable to pay.
What tips do you suggest for people who are looking to rent in highly competitive markets – like in NY or San Francisco?
I would try to see as many places as you can in a short time. Once you see 10 apartments in a specific location you are an expert in that specific area at that given time. So if you are interested in more than one part of the city get out there and see places and compare. I like to tell my clients to have a “top 3” at the end of the day. This way if we lose the first choice, we have 2 others to fall back on, but no one likes to lose do they?! That’s where what I just mentioned comes into play – make sure you have all your paper work ready and move quickly to apply when you find the right one.
What kinds of things can you negotiate with the owners of an apartment?
This is a loaded question and changes depending on market conditions. In a hot market there’s not a lot you can negotiate, but in a slow market you have more opportunity. The internet has made the market in New York transparent. Therefore, if the apartment has been on the market for a long period of time you may be able to get a lower price or a month of free rent, but I would consult with your broker as to not offend the landlord. If the apartment needs work you can suggest a punch list and see what the owner is willing to fix. But knowing the market is key to any negotiation that’s where your broker comes in.
So really your broker is your best friend and ally when it comes to looking for apartments. What advice can you give for those who are looking for gems in a difficult market? Is it still possible in NYC?
The “fantasy island apartment” that you see online will break your heart almost every time. If by chance it is a real listing, most likely there are not one but multiple applications pending. As I said, if you call about that listing and you get – “it’s rented but I have…” – just hang up. Finding a gem takes work and can be tough, but usually when a client loses one they really like they are ready to pounce when they see the next great place.
What is something you should never do when you are apartment hunting in New York?
Wear high heels when you have a walk-up budget, it’s happened before and they usually last about an hour.
Ok, we’re going to ask a few rapid-fire questions:
Where in New York can you still find a great deal for renting?
Up in Harlem, or the Upper East and West Sides. In general, the further downtown, the more money the apartment will cost.
Average number of apartments someone should see?
If you have time I would say 5 – 10 in each location you are interested in. If you are interested in one or two locations see 10 or so in each to make sure you are getting the best value.
1 year contracts or 2 year contracts?
If you plan on staying and the landlord will lock in your rate, or in a slow market give you a lower rent, go for 2 years. If not, sign a 1 year and see how you like it. Most landlords will offer you a renewal if you are a good tenant.
Neighborhood in New York that seems like it is cheap but is actually expensive?
Lower East Side has gotten much more expensive these days, beware.
What is a feature of an apartment that will most lower the price (walk-up, ground floor, no bedroom)?
Typically the ground floor or the 6th floor in a walk up building are the most reasonable. And my favorite, the tenement apartment with the toilet in the hall – if you don’t mind that, you’ll get a great deal!
Words that clients use when talking about an apartment that you find the most frustrating?
I don’t have a word, but the phrase, “how long do you think I have to apply?” The answer is simple, once we close the door, others can walk through it. If you see something you like, move on it before its gone.
What should you also tell your broker?
Make sure your broker knows your maximum budget so they don’t show you a bunch of amazing apartments out of your budget. Then when you see what you can afford, you want to cry.
What should you never tell your broker?
“Where I’m from you don’t have to pay a broker.” This one doesn’t usually inspire maximum effort from your broker.
If you like what you heard and are interested in working with Jimmi, you can send him an email –firstname.lastname@example.org – or give him a call – 9172734723.