I have been talking about how crazy the rental market has been getting for about two years now. Finally everyone else is reporting it too! If you watch my video rental market updates on (YouTube) I have been predicting this low vacancy trend since about April of 2010. Vacancy has been dropping every month since then as prices have been inching up higher and higher. In fact, I spoke about this so much in 2011 that I started to update quarterly instead of monthly, as not to keep repeating myself. I can feel this happening, being an active agent here in Manhattan, but sources such as the New York Times need to wait until afterwards when they have data and facts to back it up, so they are typically very late in reporting such details.
Now that I’m done talking about how much more accurate I am than the New York Times…
The rental market here in NYC has exploded!
Rents are as high as ever and apartments are flying off the shelves! In fact, the last few apartments I rented in the west village were not even on the market yet! I have to literally hook up with a client (well not literally) and then call landlords to see what they have coming up and get them in first, before the apartment hits the market. Luckily I have some great relationships with landlords from being in the business for so long.
So who is moving, then?
People who NEED to move are moving! Roommates breaking up, couples breaking up, couples moving in together, relocations from other states/countries, etc. If someone doesn’t need to move, they probably won’t! Landlords have been increasing rents when leases expire, causing tenants to want to start looking for new homes. But when they see what is actually out there for the price, many end up biting the bullet and re-signing their current lease. Someone I rented an apartment to back in early 2010 ended up with a great 1 bedroom in a doorman building for only $2150! 2 years later in early 2012, the rent went up to $2350 which caused them to consider moving. However, the competing apartments in the building were up to $2800!!! So even though they raised their rent by $200, it was still $450 below market value. That’s not to say that a different landlord wouldn’t just jack it up all the way. Many will, simply because they can. Good landlords would prefer to keep their good tenants, which makes more sense to me!
What if I NEED to move?
Good apartments are few and far between. If you are looking for a specific price, size, location, and move in date, expect not to see many options! If you see something great and it makes sense… TAKE IT! Not a lot of people are moving and prices are escalating, so do not wait for something better to come along, because it may not and then you may need to settle! Work with a broker who knows what they are doing! Like I said earlier, my greatest success stories this year happen when a client comes in to my office and I sit down with them to go over their options. Many times, I won’t have the exact apartment at the exact moment they come in, but since they take the time to sit down with me and form a relationship, I really get a sense of what they need and dig around relentlessly to find them the perfect apartment. Soon after calling all my landlords, I will get them into a place before it even hits the market (or right as it does.) And since we sit down and discuss their preferences, paperwork, approval process, and everything upfront, they can act instantly when they need to.
What about Fees?
Yeahhhhh. Sorry about that. The best thing I can tell you is that you should just make peace right away with the fact that you will most likely have to pay a broker fee… or a commission as I prefer to call it. This business is all about relationships and most of the best deals are exclusive to a broker, several brokers, or just hidden apartments that you cannot get on your own. Brokers are swarming around the few listings that exist and in most cases, you will need a broker to get that great deal. I suggest finding someone great who will do all the work for you and not run around with a bunch of idiots who will waste your time. This way, you are employing a broker who will do all the work for you and get you approved with as little hassle as possible. Rather than just run around like crazy and fork over a fee to the lucky agent who happens to show you the one apartment you decide to take. And then after all of that, they may not even have the relationships and experience needed to get you approved!
Can you just Sum it all up?
OK! Vacancy=Low, Rents=High, Fees=Inevitable, Decisions=Must be made FAST!
…Or you could just purchase an apartment!
Rates are still low and prices haven’t jumped up just yet! May be worth thinking about!