Monday

Want To Live Like Sex And The City? Find A Rent Stable Apartment.

Carrie Bradshaw could afford to stay in her Manolos and party at the hottest nightspots in part because she lived in a rent stable apartment. The stuff of urban myth, rent stabilization means that a particular apartment’s rent can only be raised a small, set percentage every year. The result is that some apartments, even in very toney areas, cost dramatically less they would if they were on the open market.

As you can imagine, finding a rent stable apartment can seem as realistic as finding the Holy Grail. Why? There are a finite number of rent stable apartments and competition is fierce. Many owners apply for the unit to be de-stabilized which would allow them to charge market rate and those units that stay stabilized often stay rented. Once someone lands a coveted rent stable unit, they often try to keep it for life and can even pass it on to their children. Because of the limited rental income, many owners do very little to the maintenance and upkeep of a unit. However, tenants are often pleased to handle the maintenance and even complete renovation of units as the low rents often outweigh the renovation costs.

While the ownership of these units can be a closely guarded secret, one management company that handles many units in Manhattan is Solil Management. They don’t advertise and they do work with brokers (begrudgingly) but you can land a rent stable units with some perseverance. Drop by the office between 9-5 Monday through Friday and complete an application. This will cost you $50.00, but if approved, you will be eligible for anything on their books for six months. There are no broker’s fees and no further application fees. Recently they have rented a large one bedroom in the East 70’s for $850.00, a studio in the West 80’s for $700.00 and even a two bedroom in Chinatown for under $900.00.

Be prepared, you will have to do some work. Many units could use fresh paint and new appliances or tiling, but since the market value of these units could easily be twice or even three times the stabilized rent, holding onto a rent stable unit could mean that whatever money invested in the property still makes the unit a bargain.

Solil Management 640 5th Avenue

originally posted November 11, 2005
Posted by Undercover Milly at 5:50 PM

2 comments:

Anonymous said...

This is one of the most ill-informed postings I've ever read. As a licensed real estate professional, let me give you the REAL STORY on rent stabilized apartments and companies like Solil Management (and to the writer of this article, first of all, the term is "rent stabilized", not "rent stable"...perhaps you are confused with riding lessons? LOL).

First of all, rent stabilized apartments are a joke. In most cases, the buildings are so run down, disgusting and tiny that no person I know would ever want to live there, even the most desperate college student. Usually the apartments and buildings haven't been renovated in 20-30 years (if ever)...we're talking lawsuits waiting to happen. And if they have been, the rent-stabilized permitted increase is higher than the open market rent! For example, I recently rented a $2300 apartment that was in a rent stabilized building. The stabilized rent was $4318.16! The owner often has to add an addendum to the lease stating that the tenant will be paying "preferrential rent" because the rent stabilized rent has now exceeded the market value. Yes, there are some rent stabilized dreams out there, but if you spend your time just looking for that, expect to live in the equivalent of basically a project or crack house. Or deal with a slumlord/idiot landlord who "just doesn't get it". Now on to that:

Solil Management. Go ahead, give them a call. If you can get them on the phone, you will find their staff to be the definition of the ghetto New York landlord experience. While their apartments can be immaculate to downright disgusting, like most rent stabilized landlords, all they care about is the bottom line. So if you're prepared to deal with the horrors of an inept, attitude-laden, understaffed and underpaid group of employees with a full fledged "New York attitude", go rent from them! There is no truer saying than "you get what you pay for" in this life. And rent stabilization and companies like Solil Management are proof in the pudding! If, however, you don't really value your quality of life that much and have loads of time to waste, good luck at the craps table and don't say I didn't warn you!

1:15 PM
The Nouveau Native Girls said...

Anonymous Real Estate Pro. – I completely agree with two of your points.

1. You get what you pay for.
2. Solil can be a nightmare.

The problem is that many people watch TV or movies and think “gee if only I could land a rent stabilized apartment…..” without understanding that the units are RARE. This means bad news for both real estate agents who have the deal with unrealistic expectations and for renters themselves. BUT the fact is that many people do live in rent stabilized units and for those that can find them, they can be a real financial God send. So the battle is to get renters to understand that the units do exist, there is real competition for them, and that there is no guarantee that they will qualify or get selected for coveted units.

The other problem is that rent stabilized units are NOT good solutions for short term renters. Why? Because they almost always fall into the category of “handy man special.” They can be real dumps that haven’t been renovated since the last tenant moved in which can be 20 or 30 years. So what could the plus side be? Well if you can land an apartment that is a fraction the cost of the “average” unit and are either handy enough to do the work yourself or think long term enough to see that you can create a customized space in an area that you might never be able to afford otherwise, it can be a terrific investment.

A few years ago, one of my clients rented a two bedroom rent stabilized units for about $800.00 on the UES. The place was a dump. It needed a new kitchen and new bath. The walls hadn’t been painted in years and years. But the going rate for similar sized units in the area was almost $2600.00 a month. Yes she lived in a crappy apartment. She spent almost $5,000 in getting a new kitchen, bath, new tiles and having the fading paint and wall paper steamed off the walls. But, she had the kitchen and bath just the way that she wanted it. She had the tiles and color scheme that she liked. She changed the layout of the kitchen to be more inline with modern open plan living. She took on the painting herself. But what she got in the end was a home that she loves.

Most importantly however, her rent is still around $800.00. So she spent $9,600.00 on rent, $5000.00 on renovations that first year. That equals about $14,600.00. Similar market rate units cost $31,200.00 the first year. But the second year her rent was still $9,600.00 and the similar units were $31,200.00 and rising. It doesn’t take a rocket scientist to see why people are thrilled to find those crappy rent stabilized units.

As far as Solil Management: They have a reputation as having a less than pleasant attitude. However, they are also one of the largest rent stabilized management companies in town. And while their units tend to be on the crappy side, they are almost always very flexible about renovations as long as they meet code. So not mentioning them wouldn’t be beneficial to readers at all.

If you are looking for a short term home, a rent stable (and no not riding school) unit is almost always a mistake. But if you are the type of person who wants a long term home and is willing to put in the work or money, rent stabilized apartments can make a huge difference to quality of life, by giving access to otherwise unobtainable neighborhoods and a lot more money in your pocket long term.

Thanks for posting!
NN

1:43 PM

Post a Comment

Subscribe to: Post Comments (Atom)