If you’re coming to New York City from out of town, you might be baffled to find so many apartments represented by brokers—real estate agents who charge the renter a substantial fee for signing an agreement. By substantial, we mean somewhere between one month’s rent to as high as 15% of a full year's total payments.
This is a fact of life in New York’s highly competitive rental market.
It’s not uncommon to see a New York City apartment home rental begin with the owner’s agent negotiating with the prospective renter’s agent. The renter pays the costs of these services before signing the lease.
Although paying the broker’s fee is an established business custom, it can be circumvented. So, is working with a broker worthwhile, or to be avoided? Here, we lay out the way it works so our readers may decide.
The Benefits of Brokers
The New York City rental market is pricey, and finding deals is an art. A broker knows the scene. Brokers can find the available vacancies where apartment hunters prefer to live. They can often negotiate and help an owner and a prospective renter get to “Yes.”
New York is so competitive that many agreements are made even before an apartment is listed. Brokers are known for making those agreements.
The Downsides of Brokers
The most obvious downside to working with a broker is the fee for having someone in the middle of a deal rather than working directly with the owner or property management company.
Another downside is the possibility that the broker will steer the hopeful renter to places that aren’t suitable or affordable.
Some brokers will bend over backwards to help. Others may lead renters astray. And look out for the online no-fee apartment ad that turns out to be a mirage, with the broker demanding fees once the renter likes the place and is ready to rent.
Alternatives: No-Fee Apartments in New York City
Hoping to avoid the downsides, a prospective renter may look for fee-free listings. No-fee means you rent directly from the owner or management company, or the broker's fee is owner-paid.
No-fee buildings tend to be the luxury apartments. The rent is typically higher, so you’ll often see write-ups that call a no-fee rental “a wash” in terms of money spent.
Then again, luxury apartments give you something for that extra cost.
Five Tips for Finding a No-Fee NYC Apartment
There are several ways to score a no-fee apartment. Here are 5 ways to do it.
- Talk with people. Find an apartment through friend, colleagues, or social media. Ask. Sometimes, it’s the quickest way to receive.
- Do an online search for no-fee NYC listings.
- Walk around the NYC neighborhoods that appeal to you. Ask the concierges at the doors if there are apartments for rent.
- Look for apartment-for-rent flyers in grocery stores, at coffee shops and internet cafés, and in windows. Even if you see a broker’s number, dig a little more and try contacting the management company directly.
- Rent in a luxury apartment building, which typically has an office where you can sign an agreement directly with the management.
Carlyle Property Management manages no-fee rental apartment buildings in Manhattan. If you prefer to direct your dollars to amenities rather than to large broker payments, our apartment homes might be the perfect fit for you. We invite you to contact us to learn more.