Priced Out of Manhattan? Not So Fast Good Renters!

With vacancy rates at less than 1% many renters are feeling the fear and are avoiding Manhattan. For those who have less than stellar credit or would require multiple room mates in order to meet the monthly rent, Manhattan’s isn’t a good bet right now. Your likelihood of landing an apartment is lessened thanks to the economy. But, many potential renters who are “safe bets” for landlords are being scared away unnecessarily.

When the market gets tighter, those potential renters who are considered “marginal” in terms of their credit and ability to meet the rent payments (due to low or instable salaries) face tremendous challenges in getting approved. Think about it from a practical perspective, landlords are in business and that business is to make a profit off of the letting (or renting) of their property. As with any savvy business man or woman, landlords want to contract with the person or couple MOST likely to be able to meet the financial obligations of the rental contract.

When the market tightens and there are fewer availabilities, landlords have the advantage of having more potential renters from which to choose. Of course, any responsible business person will choose the person best equipped to meet the responsibilities. In real estate rental terms, this means the person with the best credit and most stable job with a salary that is comfortably within the rental affordability formula. Does this mean that someone without stellar credit or whose salary is low wouldn’t make a good tenant? Does this mean that people with high paying jobs are always going to be great tenants? Of course not! There are great tenants that scrimp and save and make sure that they always meet their obligations. There are other high flyers that fail to meet obligations. But as a whole, a clean credit report and a salary comfortably within range are the best bets for landlords. And with a tightened market there are more people that fall in that category from which to choose.

If you have a good credit file, a steady job, and a salary that the landlord considers adequate to meet your responsibilities (typically 40X the annual rent), living in Manhattan shouldn’t be out of your reach. Yes it may take a few more applications before you get an approval, but no matter the economy, landlords are looking for “safe bet” tenants.

So, pick up your copy of The Nouveau Native’s No Fee New York 2008 and start contacting landlords that meet your criteria. It is ok to be scared of the Manhattan rental market. But Manhattan is the greatest place on earth so, feel the fear and do it anyway.

Economy Woes for Manhattan Renters

New York has always been among the priciest rental markets in the country, but this year is forecast to be historical. And not in a good way. The vacancy rate has hovered around the 3% mark for years. But in 2008, the vacancy rate is below 1%, meaning that less than 1% of all rental units are available for rent at any given time. Less rental inventory means more competition for each available unit. To make matters worse, with apartment sales slumping and many people afraid to jump into the sales market, more people than ever are renting. This of course exacerbates the problem.

When inventory is so tight, landlords typically take advantage of the market. The average 1 bedroom, doorman apartment will set you back $2,700.00 a month, that is a $500.00 increase from just five years ago. This increase is forcing many to go further afield to find accommodation. Brooklyn, once the first stop for those priced out of Manhattan is now prohibitively high as well. So renters are forced to look to Queens, Staten Island, New Jersey, Yonkers, and Connecticut for reasonable prices. For many the long commute and inability to live in Manhattan is making a career in NY less than desirable.

Fear of the Bad Old Days in NYC

Today's New York Post had a real eye opening and thought provoking article that I wanted to share. The article talks about the "Revenge of the Bad Old Days" in New York City, where crime was rampant, graffiti and destruction was common, and people didn't feel safe in their homes.

I first moved to NYC in the closing years of those "bad old days" and completely understand both the desire to forget and the need to remember. I have lived all over the world and can say whole heartedly that in my opinion, New York City is the greatest city in the world. I understand that much of the problem has to do with decreasing police forces, but I urge people to be vigilant.

NYer's are often stereotyped as being self absorbed or as people who don't care about their fellow man. We know that this isn't true. But when punks destroy bus shelters, apartment buildings, and businesses we all suffer, both the loss of our neighborhoods but also our own security. Criminals see a community where graffiti is tolerated and panhandlers are placated as a place where they can rob, rape, assault, sell drugs, and further damage property without fear of being arrested or even reported.

So how do we protect our communities? Here are some ideas:

1. Get involved with (or start) a Neighborhood Watch

2. Report crime, vandalism, and pan handlers to the police. If you don't report it, nothing will be done about it.

3. DO NOT give money to pan handlers. They stay in an area because the spot is financially lucrative. Instead, donate money to organizations that feed, cloth, and provide training to homeless people to get them back on track.

4. Donate time and/or money to New York Cares which provides access to hundreds of events taking place in NYC that benefit the community as a whole.

5. Set a good example. Make sure that your trash gets into the garbage can and clean up after your dog. Often criminals target uncared for blocks first to establish a base of activity.

6. Get involved with one of the community improvement organizations. These organizations sponsor graffiti cleaning, mural painting, garden and park cleaning, and other activities designed to make the neighborhood a cleaner, more friendly place.

We do need the number of police on the streets to increase. But we can't let apathy return us to the "bad old days" of crime and fear.

No Fee Apartments in NYC

I got an email yesterday from Henni who wanted to know how much money he should spend on securing a no fee apartment. I have discussed the difference between a no fee and a broker fee apartment before, but I thought this would be a good time to explain that a no fee apartment doesn’t mean FREE apartment and that there are costs associated with a no fee rental.

No Fee means No Broker Fee. In other words, if you rent a no fee apartment you are renting an apartment that doesn’t have a broker’s commission attached. Usually there is no broker fee attached because a real estate agent/broker hasn’t assisted you in renting the apartment. However there are some occasions where the owner pays the commission on behalf of the renter as an incentive.

Credit Report Fees: Management companies and landlords run credit checks on each adult on the lease and in some instances, each adult living in the apartment. These fees vary depending on the credit reporting service that they use and on the thoroughness of the report. Some companies simply check your basic credit report for delinquencies and credit scores. Others run a full battery of checks including tenancy court action, employment verification, and even criminal background checks. Management companies have to pay for credit reports whether you end up renting a unit or not, so credit report fees are non-refundable.

Application Fees: This term is sometimes used interchangeably with “credit report fees” but in reality should include both the charges associated with running credit as well as paying for the time that it takes to prepare leases. Application fees are also not refundable.

Holding Deposit: Some landlords require a holding deposit while they run credit checks. A holding deposit is typically between $300 and $500 and is used as an assurance that you are serious about renting the apartment for which you have applied. Since many people put applications on every apartment that they see in an effort to maximize their chances, small landlords who typically stop showing an apartment once an application is accepted, use holding deposits as a security measure to insure that they are only proceeding with someone who is serious.

Holding deposits are typically applied to the actual deposit. So at the lease signing, you would bring a certified check for the first month’s rent and the remainder of the deposit. If your credit comes back and is not acceptable, the landlord will return your holding deposit immediately. If however you are approved and change your mind, holding deposits are non refundable, so make sure that you are serious about the apartment before leaving a holding deposit.

Application fees and credit report checks vary widely, but average between $35 and $75 per adult, for most typical rental buildings. However, fees of $100 to $150 are not unheard of, especially if the management companies run a full background check, which is becoming more common these days. If your unit is very high end or if you are applying for a co-op, fees can be as high as $500. Remember, these fees are non-refundable, so think carefully before you apply.

Tomorrow we will talk about building and unit selection.

Get Out Your Map! - Steps To Finding The Perfect Pad

One of the most challenging aspects of searching for an apartment is understanding that limiting your search is often more effective than broadening it. This is typically opposite the way that you would look anywhere else, but it is important. Why? Because there are so many apartments available and they move (get rented out) so quickly, that unless you have a firm strategy you will spend your time running all over town instead of looking at apartments that truly fit your requirements.

Ask many apartment seekers what their requirements are or even what constitutes a “perfect” apartment and you will find that many people don’t have a clear idea of what they really want. Landing an apartment that ultimately turns out to lack in some qualities that are important to you will result in disappointment in an otherwise great apartment. Finding your perfect apartment is really a question of determining your priorities and evaluating your lifestyle.

GET OUT YOUR MAP!

Where do you spend most of your time? For the majority of people, most of their time is spent at work or at school. If you work late or have crazy hours, finding an apartment that is either close to work or close to transportation can seem like a real luxury. Few things compound a bad day or a long work day quite like an intolerable commute or long walk from subway stop to front door.

Priority #1 – Walking distance to work or close to direct transportation link.

Once you have selected a few areas that meet priority #1, ask yourself, “How do I REALLY live?” Many people make a mistake in choosing an apartment that they feel will force them to make lifestyle changes. If you are overweight, choosing a top floor walk up will not make you fit. It will only make you hate your apartment and keep you a virtual prisoner. Similarly, if you are planning on getting pregnant, a top floor walk up is also not a great choice. Many people choose an address or a neighborhood because they feel that it will make them appear more successful or trendier. All this really does is creates a situation in which you can’t leave your home without ‘acting.” Your home should be the place where you fit in and are comfortable, not a place where you have to put on a never ending play.

Priority #2 – Apartment and neighborhood that fits “me” as a person.

You have selected the neighborhoods in which to search, weeded out that ultra expensive neighborhood, and determined that you won’t be happy in a walk up that is above the third floor. Now you need to consider your responsibilities? If you have kids and or pets, you need to figure out what areas of your selected neighborhoods will work best for them. Living on a block that has a lot of loud nightclubs and bars, may not be great if you have a baby, small child, or a dog with a nervous disposition. If you enjoy taking your child or dog to play in a park, finding an apartment close to a park will be helpful as well. Do you need to consider proximately to schools or day care?

Priority #3- Neighborhood and apartment that will fit my responsibilities.

Reflecting on these 3 priorities should have helped you to narrow down the neighborhoods and even blocks that will provide you the best options for apartment happiness!

Tomorrow we will look at building selection methods.

Options For Renters - The Nouveau Native's No Fee New York

Last week we discussed options available to people attempting to find rental housing in New York City. We covered traditional brokers, list services such as RentDirect.com, and online bulletin boards like Craig’s List. Today we are going to discuss The Nouveau Native’s No Fee New York guide book series and how it can be best used to assist renters in finding and renting a no fee apartment.

First, let’s do a quick comparison. Using listings services or online bulletin boards can be a great way to find avoid paying brokerage fees.

But there are downsides. With listing services:
1. You have to rely on the accuracy of whoever types the details into the computer.

2. You have to trust that the listing service or owner of the property has updated the information quickly; otherwise you will waste your time going to apartments that are already rented.

3. You have limited, if any, information about the management company or owner’s credit, financial, and background requirements. This often means that you waste time looking at and applying for apartments for which you don’t meet the application requirements.

4. Listing services generally list apartments that are empty and available today. For people interested in moving in a few weeks or even a few months, listing services can be rather limited since they infrequently list occupied units.

5. Listing companies aren’t free. They range in price from around $10.00 to almost $250.00 depending on the services, popularity, and reputation of the company.

With online bulletin boards:
1. In the old days, when almost all rental advertisement was conducted in newspapers, a broker had to prove that they were licensed by the state prior to placing an ad. In addition, ads were expensive, so brokers concentrated on advertising the units that they actually had to rent. Today, online sites offer free (or very inexpensive) ads to anyone who wants to post. This creates a system in which brokers and listing services list not only apartments that they actually have, but also post “bait and switch” ads and teaser ads in order to get renters to call. This means that there are a lot of ads on bulletin boards that have no relation to available apartments.

2. By the same token, since sites don’t require posters to prove that they are licensed, online bulletin boards are used by unscrupulous types in order to commit crimes such as sublet or rent scams.

3. Updating information is the responsibility of the poster. This often means that information is out dated.

4. In most instances, bulletin board listings are for only for empty units which are available for immediate occupancy. If you are interested in apartments available in a few weeks or months, a bulletin board can have limited results.

5. Generally bulletin board ads don’t list application requirements, which means that you can waste a lot of time looking at apartments for which you can’t qualify.

Looking for an apartment with the help of The Nouveau Native’s No Fee New York eliminates many of the problems listed above as well as removes the requirement to pay any brokers fees. But how can people effectively use the guide to find an apartment?

There are three major benefits to using The Nouveau Native’s No Fee New York to find an apartment.

First and foremost, the guide provides detailed information about the rental process in NYC. For those of you new to NYC or new to renting, the differences between here and anywhere else on the planet can be very confusing. Understanding the process is really an essential component to becoming a renter. In addition to the actually process of finding an apartment, the guide explains the rather complicated rental application procedures and the methods that landlords and management companies use to select an application. No matter how many apartments you apply for, if you don’t meet the landlord’s particular credit, financial, and personal stat requirements, you won’t be able to rent.

Second, The Nouveau Native’s No Fee New York profiles over a hundred Manhattan landlord’s and management companies. These management companies collectively represent over 10,000 available units. More than just listing addresses and contact details, we break down the actual application requirements, types of buildings and apartments (including maintenance and amenities) available, and the general price range in which their units fall. For most companies, collected industry opinions about the application flexibility, value for money, and apartment quality are also included.

By assessing your own financial realities and apartment criteria, you can quickly search through the management companies using our quick profile graph. This insures that you are only looking at properties managed by companies that will approve you, saving you a lot of time and energy.

And finally, apartment buildings are also listed by address in the Table of Contents. So, if you are walking down the street and like the look of a building, but have no idea how to apply or how manages the building, you can look the address up in The Nouveau Native’s No Fee New York and flip right to the management company’s profile page!

Tomorrow we will discuss methods of searching using The Nouveau Native’s No Fee New York guide books to insure that you are fully aware of ALL properties in your price range and not just the ones empty today.