How to Rent Smart in New York City?

July 17th, 2009 Posted by Featured, Real Estate No Comment yet

CASE STUDY

Case Study: A choice between a studio in an old walk-up in the east village $1,600 with a broker or a no-fee studio in a luxury apartment in lower Manhattan for $2,500.

Studio in old Walk Up in East Village Studio in a Luxury Building in Lower Manhattan
Subway lines 15 mins away with only one 6 train 2 mins away from five trains: 4, 5, 1, R, W trains. 5 mins from eight trains: A, C, E, J, M, Z, 2, 3.
Age of apartment/reno 20 years old 2 years old
Rent $1,600 $2,500
Gym $   100 Included
Free Exercise Classes Have to sign up with gym Free
Cabs $   200 Faster to travel by trains
Broker Fees $   288 None
Electrical Bills $   100 $30
Laundry $   60 in Laundromat $60 in the building
Meals $1,000 $500
Doorman None Yes
Valet, Concierge to pick up packages, deliveries Go to Post Office on weekends. Yes
Elevator None, 4th floor walk up Yes
Furnished? No, bare apartment.$333 (assuming $4K spent on furnishing & delivery, spread over 12 mths) Fully furnished (including stocked kitchen and equipped home office), $15K worth of furnishings
Total $3,681 $3,090

You actually save close to $600 A MONTH by going for the seemingly more ‘expensive’ luxury building than the ‘sensible’ walk up. Not to mention the time and hassle you saved by renting a fully furnished apartment instead of a bare box!  Rent smart! Just illustrating a simple case of ‘do not judge an apartment based on the rent.’ PS: The difference will widen if you are sharing the apartment with another a friend/spouse.

Valuable Tips

1) A lot of luxury buildings have walk-in rental offices. Most of them do not charge broker’s fees. I have engaged a broker once and he ended up bringing me to these buildings, which I can just go myself.  I could have saved myself 2 months’ of rent in broker fees or negotiate for lower rent! Read another article I wrote on “Sure Fire Way to Find Your Dream Apartment in New york City!”.

2) Do not overlook the advantage of renting from an owner directly versus a rental building. Owner are mostly more flexible in month-to-month rent after you have rented with them for a year or two. Rental buildings are more stringent on the contract details. This will come in handy if you are unsure about your length of stay or if you are looking around to jump on a great rental deal or you are finally looking to buy.

Also, if you can find a furnished apartment for rent by an owner instead of by a rental building, you will find that most of the owner’s furnishings are of better quality as they have bought them for their own stay. (Be careful of scams online)

3)     Check out Craigslist. (Several Scams are spotted there, so be careful.) It’s a quick way to ‘feel’ the market.

Special Note for my fellow Singaporeans!

Differences between Singapore and New York Rental Market:

1) The broker fees in Singapore are usually ½ to 1 month of rent for every year of lease. The broker fees in New York are usually 15% of the annual rent, which is 1.8 months of rent. It is usually the same for residential lease regardless of the length of the lease. (Note the broker fees are ALWAYS negotiable.)

2) The tenants’ credit history is of utmost importance in New York.  This will be for most foreigners’ their biggest challenge. Landlords in Singapore are mostly concern about the legal status  (PR, work permit, student pass, etc) of the tenants and not so much the credit history.

3) Most apartments do not have washer and dryer. Some have laundry rooms in the building. Lugging your laundry out to a laundromat is more ‘leh che’ than you think, especially when it’s freezing and snowing.

4) Similar point to (2), try to build credit as soon as possible, like opening up a secured credit card. Who knows, you might be staying in the states for a while and a (good) credit history always come in handy.

Good luck on your search for your apartment in NYC! Welcome to New York, quoting from one of my friends, Merle, ‘one of the rare cities that truly live up to its name’!

Cheers!

Mira

P.S.  Don’t forget to refer to the Rent Smart checklist below when you are searching for your apartment!

P.S.S. Please go to www.sporeny.com to view the apartment used in case study.

P.S.S.S: If you need a copy of the Rent Smart checklist, please send me a message at Contact Us. I will send you a copy.

Definitions

Walk up: Mostly in older or tenement buildings, no elevator, no gym/facilities or doorman. Most has no laundry room.

Condo/Co-op: For rental purposes, there is no difference between a condo or a co-op, except for the beginning application, whereby co-op have stricter criteria and some co-op boards limit the total lease period, say, not to exceed 2 years.

Rooms: 2-room-apartment is different from a 2-bedroom apartments. Some advertisement lists the apartment as having ‘2 rooms’, which is basically a studio with one bathroom and the living space/room.

Common short forms: EIK = eat in kitchen; WIC = Walk-in-closet, PT DM = Part time doorman.

Rent control/rent stabilized: Some apartments in New York are rent stabilized or control with limited increase in rent every year, resulting in sometimes ridiculously low rent in prime places. As most ‘new’ New Yorker will mostly likely not end up in one of these apartments, I have left them out in my discussion above. Check out the Rent Smart Checklist below!

RENT SMART CHECKLIST

Rent Smart Checklist Apartment 1 Apartment 2
Convenience
How far is the subway station?
– Which neighborhood is the apartment located
– What trains are available?
– Valet? Doorman? Concierge? Feel safe?
Comfort
– How old is the place?
– Other Amenities?
  • Gym
  • Washer Dryer/ Laundry Room
  • Exercise Classes
  • Superintendent/handy man
  • Outdoor Space
  • Others
Terms/ Finance
  • Prepayment of rent?
  • Deposits
  • Month to month?
  • Utilities in landlord’s name?

Effective Cost
  • Gym
  • Cab
  • Brokers’ fees
  • Application fees
  • Free rent
  • Water, Gas
  • Electrical (good insulation?)
  • Washer Dryer/ Laundry Room
  • Usable Kitchen
  • Furnished
  • Others
Total $ $

P.S.S.S: If you need a copy of the Rent Smart checklist, please send me a message at Contact Us. I will send you a copy.

Copyright 2009 by Farting Camel

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