Top 10 Misconceptions about Renting Apartments in NYC
Once you get past these presumptions, apartment hunting will be a heck of a lot easier, and you'll be able to parse the gimmicks from the deals. (All of these topics are covered for free on my "Renter Education" page!)
Myth: "No fee" apartments save you money.
Reality: Upfront, yes, but they may come with a catch. For example, some of these buildings also advertise "one month free rent" then list the rent based on "net effective rent". This is where people get confused: Net effective rent is what the rent comes to with the discount factored in. While it is true that it's what you'll be spending overall if you factor the free month in, reality is that you'll likely be paying the full gross rent from the second month on and any rent increases in the second year will occur on top of the actual gross rents, and that can really add up.
solution: Free advice should be available from an experienced professional who can help you plug the numbers relative to your situation. You can also start off by checking out the rent calculator provided on this website.
Myth: Rent control and stabilization guarantee affordable rents.
Reality: Maybe for people living in these coveted apartments. But those people are also less likely to move and people not moving give you fewer housing choices. On top of that low housing stock in a neighborhood can jack up the going price of available units forcing locals who aren't privy to rent controlled units to move while people willing to pay more get to grab the deals they want. In addition, note that many people move within a year or two after signing their initial lease. This defeats some of the benefits.
solution: Don't get fixated on only finding apartments that offer preferential rent, especially if you are planning to increase your salary and move after just a couple of lease renewals. If you can save yourself 3-7% from the get go, it may be enough to ride things out for the first couple of lease renewals. On the other hand, don't get me wrong, finding the right rent stabilized apartment can be a super lucky catch, and working with a real estate agent such as myself who knows where to look can definitely help you out if that's your goal.
Myth: The secret of getting a lease put through is by doing your best to assure the landlord that you you're a good person and can pay the rent.
Reality: In the big picture, maybe, but it's really all about proving things by submitting the requested documents in a timely matter. This means, your proof of income and credit report/background check are your key documents. Remember, the magic numbers landlords are looking for will usually be contained in the documents they are requesting. Be sure to have them ready!
solution: There will usually be space on most documents to offer additional information if you need to explain something, but keep in mind that you really need to deliver the goods. As an example, talking about how much money you're going to make in the future due to your training and experience is one thing, but including formal job offer letter that proves you're about to start a new job at a good company is another. When all else falls short guarantors (personal, corporate or third party) are often worth their weight in gold.
Myth: You can find an apartment in one day.
Reality: Finding an apartment in NYC can be a time-consuming process What often happens is that by the time you put in an application on a unit its often gone or there's many applications in, and if you're not a competitive applicant you end up having to go through the process again and again because by the time you go back to the drawing board to put in applications to the other apartments that you passed on, they too may be gone, so you're back to the drawing board.
solution: Make sure you're pre-qualified before applying for any apartment, then move quickly, once you hone in on the right place. By quickly, I mean that once you've made up your mind you need to fill out that application, assemble the documents you need and get them in quickly. Do not drag your butt, or slow things down by submitting it with missing documents or information.
Myth: Renting in NYC is only for the wealthy.
Reality: Yes, it is a pricy market; however, there are affordable options available for renters of all income levels. For example, there are rent-stabilized apartments, public housing, guarantor companies and community-based organizations that can hep you out. In addition renter education (as is offered by this site) and better knowledge of housing options can empower tenants to save money and find affordable houses, by making the right choices and learning how to navigate the market efficiently.
solution: Know your resources and use them, also be flexible within the constraints of your budget.
Myth: Credit score doesn't matter / Credit score is all that matters.
Reality: Many landlords and property management companies will run a credit check on potential renters, and a low credit score can make it difficult to secure an apartment. For example, some landlords will reject an application due to a low credit score, even if the renter meets all other requirements. On the other hand, credit score only makes up part of the picture and remedies are available for tenants who can balance things out in the big picture.
solution: Know what kind of apartments you're likely to qualify for, and in the meantime, improve your financial health education. Also, be aware of what resources are out there for your particular situation.
Myth: You don't need a co-signer or a guarantor / You're screwed if you can't find one.
Reality: Many landlords and property management companies do require a co-signer or a guarantor, especially for renters with low credit score or insufficient income. For example, a landlord may require a co-signer or a guarantor to guarantee that the rent will be paid on time. For people who can't find their own guarantors, affordable third party guarantor companies do exist!
solution. If you have any strikes against you, I highly advise pre-qualifying with a guarantor company.
Myth: The more you pay, the better an apartment you'll get.
Reality: While it is true that you are going to pay for location, size and amenities, you can leverage your actual needs to balance things out. For example, I currently live in a 1 BR convertible studio apartment in Astoria with its own back yard and a *huge* modern luxury style kitchen. I'm paying about half to a third the price I would have if I was only willing to live in Chelsea or the Village or was only willing to live in a luxury high-rise instead of multi-family dwelling, The more you're able to leverage what you don't need, the better the deal you can get.
solution: Work with an agent who will truly help you think things out so you can truly get the best deals not just pay more just to pay more otherwise opportunities will zip right by you. In my view a major role of an agent is to help you strategize so you can get the best place you deserve, not just the first one you happen to fall upon then qualify for.
Myth: You don't need to see the apartment before signing the lease.
Reality: Yeah, and that's how most scams work. It's important to see the apartment in person before signing the lease, to ensure that it's in good condition and that it meets your needs. For example, it's important to check for any potential issues like leaks, mold, or pest infestations, and to make sure that the apartment is located in a convenient area that meets the renters' lifestyle and needs. In addition, there are wire-fraud scammers who literally make their living renting out non-existent apartments.
solution: If you do need to take an apartment site unseen, make sure you're working with someone you can trust. Don't just answer a Craigslist ad and wire money to the first person who promises you a too good to be true deal!
Myth: Leases are a bunch of legal mumbo jumbo. You don't need to read them carefully.
Reality: It's important to read the lease carefully, to understand the terms and conditions of the rental agreement, and to avoid any misunderstandings or disputes with the landlord or property management company. For example, it's important to be aware of any restrictions, fees, or penalties that may be included in the lease, and to make sure that the lease aligns with the renters' expectations and needs.
solution: Take time to read the lease and if you have any questions, ask away. There are no stupid questions only unfortunate/avoidable outcomes! While it's true that many leases are similar and you may not have enough legal knowledge to recognize unenforceable provisions, you really do need to know what you're getting into.
Reality: Upfront, yes, but they may come with a catch. For example, some of these buildings also advertise "one month free rent" then list the rent based on "net effective rent". This is where people get confused: Net effective rent is what the rent comes to with the discount factored in. While it is true that it's what you'll be spending overall if you factor the free month in, reality is that you'll likely be paying the full gross rent from the second month on and any rent increases in the second year will occur on top of the actual gross rents, and that can really add up.
solution: Free advice should be available from an experienced professional who can help you plug the numbers relative to your situation. You can also start off by checking out the rent calculator provided on this website.
Myth: Rent control and stabilization guarantee affordable rents.
Reality: Maybe for people living in these coveted apartments. But those people are also less likely to move and people not moving give you fewer housing choices. On top of that low housing stock in a neighborhood can jack up the going price of available units forcing locals who aren't privy to rent controlled units to move while people willing to pay more get to grab the deals they want. In addition, note that many people move within a year or two after signing their initial lease. This defeats some of the benefits.
solution: Don't get fixated on only finding apartments that offer preferential rent, especially if you are planning to increase your salary and move after just a couple of lease renewals. If you can save yourself 3-7% from the get go, it may be enough to ride things out for the first couple of lease renewals. On the other hand, don't get me wrong, finding the right rent stabilized apartment can be a super lucky catch, and working with a real estate agent such as myself who knows where to look can definitely help you out if that's your goal.
Myth: The secret of getting a lease put through is by doing your best to assure the landlord that you you're a good person and can pay the rent.
Reality: In the big picture, maybe, but it's really all about proving things by submitting the requested documents in a timely matter. This means, your proof of income and credit report/background check are your key documents. Remember, the magic numbers landlords are looking for will usually be contained in the documents they are requesting. Be sure to have them ready!
solution: There will usually be space on most documents to offer additional information if you need to explain something, but keep in mind that you really need to deliver the goods. As an example, talking about how much money you're going to make in the future due to your training and experience is one thing, but including formal job offer letter that proves you're about to start a new job at a good company is another. When all else falls short guarantors (personal, corporate or third party) are often worth their weight in gold.
Myth: You can find an apartment in one day.
Reality: Finding an apartment in NYC can be a time-consuming process What often happens is that by the time you put in an application on a unit its often gone or there's many applications in, and if you're not a competitive applicant you end up having to go through the process again and again because by the time you go back to the drawing board to put in applications to the other apartments that you passed on, they too may be gone, so you're back to the drawing board.
solution: Make sure you're pre-qualified before applying for any apartment, then move quickly, once you hone in on the right place. By quickly, I mean that once you've made up your mind you need to fill out that application, assemble the documents you need and get them in quickly. Do not drag your butt, or slow things down by submitting it with missing documents or information.
Myth: Renting in NYC is only for the wealthy.
Reality: Yes, it is a pricy market; however, there are affordable options available for renters of all income levels. For example, there are rent-stabilized apartments, public housing, guarantor companies and community-based organizations that can hep you out. In addition renter education (as is offered by this site) and better knowledge of housing options can empower tenants to save money and find affordable houses, by making the right choices and learning how to navigate the market efficiently.
solution: Know your resources and use them, also be flexible within the constraints of your budget.
Myth: Credit score doesn't matter / Credit score is all that matters.
Reality: Many landlords and property management companies will run a credit check on potential renters, and a low credit score can make it difficult to secure an apartment. For example, some landlords will reject an application due to a low credit score, even if the renter meets all other requirements. On the other hand, credit score only makes up part of the picture and remedies are available for tenants who can balance things out in the big picture.
solution: Know what kind of apartments you're likely to qualify for, and in the meantime, improve your financial health education. Also, be aware of what resources are out there for your particular situation.
Myth: You don't need a co-signer or a guarantor / You're screwed if you can't find one.
Reality: Many landlords and property management companies do require a co-signer or a guarantor, especially for renters with low credit score or insufficient income. For example, a landlord may require a co-signer or a guarantor to guarantee that the rent will be paid on time. For people who can't find their own guarantors, affordable third party guarantor companies do exist!
solution. If you have any strikes against you, I highly advise pre-qualifying with a guarantor company.
Myth: The more you pay, the better an apartment you'll get.
Reality: While it is true that you are going to pay for location, size and amenities, you can leverage your actual needs to balance things out. For example, I currently live in a 1 BR convertible studio apartment in Astoria with its own back yard and a *huge* modern luxury style kitchen. I'm paying about half to a third the price I would have if I was only willing to live in Chelsea or the Village or was only willing to live in a luxury high-rise instead of multi-family dwelling, The more you're able to leverage what you don't need, the better the deal you can get.
solution: Work with an agent who will truly help you think things out so you can truly get the best deals not just pay more just to pay more otherwise opportunities will zip right by you. In my view a major role of an agent is to help you strategize so you can get the best place you deserve, not just the first one you happen to fall upon then qualify for.
Myth: You don't need to see the apartment before signing the lease.
Reality: Yeah, and that's how most scams work. It's important to see the apartment in person before signing the lease, to ensure that it's in good condition and that it meets your needs. For example, it's important to check for any potential issues like leaks, mold, or pest infestations, and to make sure that the apartment is located in a convenient area that meets the renters' lifestyle and needs. In addition, there are wire-fraud scammers who literally make their living renting out non-existent apartments.
solution: If you do need to take an apartment site unseen, make sure you're working with someone you can trust. Don't just answer a Craigslist ad and wire money to the first person who promises you a too good to be true deal!
Myth: Leases are a bunch of legal mumbo jumbo. You don't need to read them carefully.
Reality: It's important to read the lease carefully, to understand the terms and conditions of the rental agreement, and to avoid any misunderstandings or disputes with the landlord or property management company. For example, it's important to be aware of any restrictions, fees, or penalties that may be included in the lease, and to make sure that the lease aligns with the renters' expectations and needs.
solution: Take time to read the lease and if you have any questions, ask away. There are no stupid questions only unfortunate/avoidable outcomes! While it's true that many leases are similar and you may not have enough legal knowledge to recognize unenforceable provisions, you really do need to know what you're getting into.