When I'm showing properties downtown, I often like to point out certain streets such as Stuyvesant Street, that survived the "grid system" imposition, mostly due to political connections and/or prominence of those who lived there. Such angled streets, as they crisscross the numered streets and lettered avenues, provide a modern charm and reminder of the New York City that once was. The article in the 3/20/11 issue of the New York Times provides a fascinating overview of how the modern day grid system was developed.
How Manhattan’s Grid Grew
In 1811, John Randel created a proposed street grid of Manhattan. Compare his map, along with other historic information, to modern-day Manhattan.
http://www.nytimes.com/interactive/2011/03/21/nyregion/map-of-how-manhattan-grid-grew.html
Monday, March 21, 2011
Thursday, January 13, 2011
2011 Off to a Very Strong Start
2011 has kicked off with a bang in both sales and rentals. In fact, I think this has been the busiest January I have seen in well over a decade. Early January is typically slow when people are returning to work, but this year the company has been exceptionally busy right out of the gate!
On the rental side: the market remains very tight in the neighborhoods most typically demanded (e.g. Soho, Noho, Tribeca, East Village, LES, West Village, Gramcery, UES, UWS) and vacancy rates remain very low. Landlords are offering some incentives in certain neighborhoods where there exists more inventory (e.g. Roosevelt Island, some midtown West). As always, you can contact me to find the best values out there at any particular point in time. There are more details in the Q4 market report (see below).
On the sales side: sellers have become more realistic and have by now mostly adjusted their asking prices to a point in line with what buyers are willing to pay. Conversely, buyers are realizing that interest rates are no longer going done, prices are no longer going down, and that the current market is a healthy one and great opportunity to buy. An appropriately priced Manhattan property will sell quickly in the current market. And I can help a well-qualified purchaser find an exceptional deal -- there are still many out there!
Citi-Habitats has been getting an incredible amount of press coverage in just about every prominent publication that covers the real estate industry: WSJ, Crain’s, Bloomberg, The Real deal, Curbed, Daily News (see below for links to all articles).
The 4th Quarter and Year-End Residential Rental Market Report is now posted on www.Citi-Habitats.com. To check out the report on our site, visit: http://www.citi-habitats.com/market.php.
Selected 1/12/11 Press Coverage
On the rental side: the market remains very tight in the neighborhoods most typically demanded (e.g. Soho, Noho, Tribeca, East Village, LES, West Village, Gramcery, UES, UWS) and vacancy rates remain very low. Landlords are offering some incentives in certain neighborhoods where there exists more inventory (e.g. Roosevelt Island, some midtown West). As always, you can contact me to find the best values out there at any particular point in time. There are more details in the Q4 market report (see below).
On the sales side: sellers have become more realistic and have by now mostly adjusted their asking prices to a point in line with what buyers are willing to pay. Conversely, buyers are realizing that interest rates are no longer going done, prices are no longer going down, and that the current market is a healthy one and great opportunity to buy. An appropriately priced Manhattan property will sell quickly in the current market. And I can help a well-qualified purchaser find an exceptional deal -- there are still many out there!
Citi-Habitats has been getting an incredible amount of press coverage in just about every prominent publication that covers the real estate industry: WSJ, Crain’s, Bloomberg, The Real deal, Curbed, Daily News (see below for links to all articles).
The 4th Quarter and Year-End Residential Rental Market Report is now posted on www.Citi-Habitats.com. To check out the report on our site, visit: http://www.citi-habitats.com/market.php.
Selected 1/12/11 Press Coverage
Sunday, July 18, 2010
Citi-Habitats Rental Market Report 2nd Quarter 2010
The second quarter through June 2010 showed a continued strenghtening in the Manhattan rental market over the past six months. In fact, surprising to almost everybody, has been the significant drop in rental vacancies. Manhattan's vacancy rate hit a high of 2.46% in February of 2009, and has since plummeted to 0.90% in June of 2010. The last time that Manhattan's vacancy rate dropped below 1% was the peak of the pre-recession summer market in August 2007!
There's a very simple reason why the rental recovery has been so strong and so fast: the drop in rents that occurred in Manhattan in 2009 was an exceptionally rare occurrence. While Manhattan was perhaps the last to be hit, and the first to begin recovery, the dip both rents and sales prices offered were equivalent to a sale of that "brand that never goes on sale." Clients of mine who trusted my assessment of the nascent recovery in mid-2009 and who either rented or purchased in that period, are today no doubt very happy that they did so. In fact, some of my clients are sitting on a 10% increase in apartment value in less the span of a year...a pretty significant and rapid appreciation. Of course, there were also clients who, like the rest of the city, were simply too fearful of all of the unknown and unprecedented economic occurences swirling around them. I purchased my own apartment back during the last time the economy was in the midst of substantial turmoil and I knew there's no better time to buy if one has a long-term investment horizon. However, it's a difficult argument to make when fear abounds. One prominent client of mine, an executive with many years of business experience, proclaimed in 2009 that the real estate market was undoubtedly headed for a fall of another 50%. He decided to wait on the sidelines instead of buying his dream home, hoping that prices would fall substantially more. Needless to say, that hasn't happened, and instead he unfortunately missed key window for a "once in a lifetime" killer investment.
Still, there are more gains ahead as the recovery continues. For renters, the change means it's very important to approach the current market with realistic expectations. Clients continue to come to me, and particularly those from outside New York City, with the belief that landlords are desperate, that rents are negotiable, and that this is a "renter's market." Unfortunately, while there was a brief window of time when all of the above was correct, the market has changed acutely. There seems to be an 8 month to 1 year lag in terms of the economic perceptions versus current economic reality. Unfortunately for prospective renters, the competition for apartments has intensified enormously as the vacancy rate has dropped now to even below pre-recession levels. There were an average of 9,125 available apartments for rent at any point during June 2010, compared to 9,548 in May, and 9,974 in April. The drop in inventory and tightening of the rental market are both very real. As demand continues to increase through the summer months and especially as we approach the "drop dead" occupancy date for thousands of returning college students and new hires of September 1st, I always advise my clients to begin their search with all financial documentation and other required application paperwork ready to go so that they will be prepared to jump on the right apartment opportunity. Once again, we're back in a market where even a matter of hours can mean the difference of winning or losing a particular apartment. In fact, it was this typical pace of New York City that led to the very naming of this blog, "Can You Move," to ask the question: can you move fast enough when you see the apartment you love?
The other trend happening now is the increase in rent prices. As vacancy rates have fallen, rents have slowly begun to climb. Average rents are still down from last year, which continues to draw more and more renters to Manhattan, but the record low vacancy rate practically assures that price increases are forthcoming. In fact, prices have climbed substantially across all categories between first and second quarters 2010. For studios, prices are up 3.5%; for one bedrooms, up 5%; for two bedrooms, up 3.5%; for three bedrooms, up 3%.
Yet another trend is the disappearing "OP" or owner-paid concessions. In January 2010, nearly half (47%) of rental deals involved some type of landlord incentive (typically a free month of rent, or payment of 1 month towards the brokerage fee). However, in June 2010, this has dropped to 28%, a drop of 40%. As these incentives were originally added by landlords in lieu of dropping rents when the economy was turning sour, we're seeing the opposite happen in 2010: landlords are now dropping those incentives first before raising rents. As landlord confidence returns, and particularly as vacancy rates continue get closer to lighting up a "NO VACANCY" over Manhattan, rents will of course necessarily begin resuming their historical climb if only to balance out the increasing demand with the shriking supply. But for a brief moment those who can "move" can still take advantage of those remaining deals and lock in a great apartment at a sale price rent.
You can find the complete 2nd Quarter 2010 report here:
http://www.citi-habitats.com/media/pdf/RentalMarketReport2Quater2010.pdf
Monday, October 26, 2009
SALES OF EXISTING HOMES LEAP TO 2-YEAR RECORD!
As repoted by the AP on Friday, October 23rd, in September the sales of existing homes jumped to two year record. The expiration of the “First Time Homeowners” tax credit was widely attributed for the jump, although the magnitude of the increase has still defied expectations. Sales rose 9.4% to a seasonally adjusted annual rate of 5.57 million homes in the month of September. This is more than 4% above the sales expected according to a survey of economists conducted by Thomson Reuters. The median sales price of $174,900 was still down over 8% from year-ago prices, and down just over 1% from August. Unsold homes inventory dropped to 3.63 million homes, meanings that there remains less than 8 month supply of housing on the market, a low that has not been since since March of 2007. While sales are up nationally about 24%, they remain down 23% over sales from the boom period in 2005.Some housing experts and economists predict a “double dip” as unemployment remains very high and new inventory comes onto the market in the form of additional foreclosed homes. Others believe that we are in the stages of an advanced “mini-boom” that may indicate that the worst may indeed be over. It’s anybody’s guess where things will be a few months down the road, but certainly the market in New York City is showing evidence of a resurgence in healthy buying and looking activity. I've been telling my clients interested in purchasing, that over the past few weeks there has been a noteable increase in both calls from interested purchasers as well as attendance at open houses. I have even seen a couple of bidding wars, which once the norm in New York City, have not been regularly seen for many many months. It certainly feels like a housing recovery is well underway.
Friday, August 7, 2009
The Multiple-Broker Mistake...
I tend to work exclusively with most of my clients, simply because they've typically been referred by another successfully placed client and they understand that our database has a universe of nearly 97% of all available apartments within it, including those of over 400+ other REBNY-member firms. Therefore, it it's out there, my clients know that I can show it...and will show it if it's the right apartment for them.
However, we all occasionally get those clients, particularly those not familiar with the workings of the Manhattan rental market, who become so preoccupied that they will not find the "right" apartment that they begin booking appointments with other brokers and sometimes multiple brokers.
I certainly appreciate when clients tell me this, even as it creates a bit of an awkward situation. The dating analogy, would be the girl who tells her boyfriend, "As much as I like you, I really want to be sure you're the right one, so I hope you don't mind that after our date tonight, I've set up several other dates over the next few nights with other men." It's not news that anyone really wants to hear, but nontheless, I use it as an opportunity to educate my clients about the best way to use a broker in Manhattan.
All of this is premised upon the understanding that the client HAS a great broker to work with already. The client who simply knows nobody in New York and is setting out without any referral or recommendation, may gain a foothold on this task by talking to several brokers via phone and choosing the one that seems most knowledgeable, service oriented, and best able to grasp the particular apartment search requirements.
The "problem" many clients believe is created with using multiple brokers is actually not the true problem. These clients assume that one broker will be jealous of the other, or feel they're being put "head to head." The client may even feel that two or three competing brokers may work "harder" to outdo each other. But this really isn't the case...in this competitive industry we deal with that continuously and are inherently competing with the "community" of other brokers. The real problem is that the client who tries to navigate multiple brokers is unwittingly putting himself/herself at a tremendous disadvantage by destroying the two most important elements to finding the perfect apartment:
(1) building a good working relationship with your broker
and
(2) getting him/her to fully understand and appreciate all of the many nuances of your apartment preferences and needs.
What "multiple-broker" clients do not realize or understand is that I will generate a list of the "universe" of available apartments that will include virtually all of the other apartments that will be on these other brokers' lists. Do we simply run down the list and show apartments? Of course not. The only way to productively narrow down a list of several hundred apartments to the best deals and the most suitable for a given client is through the sheer experience of the agent, his ability to listen to his client and cull out the appropriate details, and the agent's ability to get knowledge and familiarity with the client's needs/tastes/preferences/etc. This "education" will often result in the broker making several immediate strong recommendations for the most suitable apartments. During the showing, the broker will get a "feel" from each reaction, comments and from followup questions, for such things as:
• Low floor or high floor
• Open layout or closed layout?
• Light over space? Space over light?
• Further downtown, or further uptown?
• Dark-stained floors? Light-stained floors?
• Buzzing neighborhoods or quieter streets?
• More living room, or more bedroom?
• More equal or less equal bedrooms.
• Front of street views? Or quiet courtyard solitude?
• Renovated apartment versus renovated building?
• Street or Avenue
and literally HUNDREDS of other comparisons/options/choices that span from the obvious to the obscure. In the span of showing several apartments and getting first-hand feedback from my client, I'm able to quickly assess which characteristics are the "must haves" and which can be sacraficed to get more of those "must have" features! In this way, over time I hone in on more and more "perfect" apartments, with often the most perfect at the end that leads to the application and the happy new tenant!
Now, what happens to the "multiple-broker" client? First of all, much as in the dating scenario, the lack of commitment isn't exactly the best way to motivate your broker to go "above and beyond" -- which is exactly what you need to score the best deal in New York City. So first and foremost, your broker knows he's just a "number," and has got a very short time to show you what he can before you're running off to the next. There's simply little motivation and no time to build a productive working relationship on that, and just as the broker may begin to be getting a great sense of that "perfect" apartment for the client's needs, that client checks his watch and must then run off to the next broker. That next broker, of course, must start completely from scratch, learning anew all of those same minute details, and very possibly planning to show those very same listings!
And then what about those "special listings," we may have...a particular new listings not yet in the system, or some incredible value that the broker is holding for a favored client...does "Miss Multi-Broker" get this recommendation? Of course not...the fear would be that the multi-broker client might communicate this special deal to the other brokers. Like in many other areas of life, trust and commitment can pay off handsomely when you're starting with an excellent broker.
Bottom line: Forget the brokers for a minute and do YOURSELF the favor...when you've been referred to a top broker, give him/her your trust and full commitment and let him/her know that! Let his/her proven success become your successful apartment find...and it will! And then you will be ready with a great recommendation when your friend asks you, "Do you happen to know of a great broker in New York City?"
However, we all occasionally get those clients, particularly those not familiar with the workings of the Manhattan rental market, who become so preoccupied that they will not find the "right" apartment that they begin booking appointments with other brokers and sometimes multiple brokers.
I certainly appreciate when clients tell me this, even as it creates a bit of an awkward situation. The dating analogy, would be the girl who tells her boyfriend, "As much as I like you, I really want to be sure you're the right one, so I hope you don't mind that after our date tonight, I've set up several other dates over the next few nights with other men." It's not news that anyone really wants to hear, but nontheless, I use it as an opportunity to educate my clients about the best way to use a broker in Manhattan.
All of this is premised upon the understanding that the client HAS a great broker to work with already. The client who simply knows nobody in New York and is setting out without any referral or recommendation, may gain a foothold on this task by talking to several brokers via phone and choosing the one that seems most knowledgeable, service oriented, and best able to grasp the particular apartment search requirements.
The "problem" many clients believe is created with using multiple brokers is actually not the true problem. These clients assume that one broker will be jealous of the other, or feel they're being put "head to head." The client may even feel that two or three competing brokers may work "harder" to outdo each other. But this really isn't the case...in this competitive industry we deal with that continuously and are inherently competing with the "community" of other brokers. The real problem is that the client who tries to navigate multiple brokers is unwittingly putting himself/herself at a tremendous disadvantage by destroying the two most important elements to finding the perfect apartment:
(1) building a good working relationship with your broker
and
(2) getting him/her to fully understand and appreciate all of the many nuances of your apartment preferences and needs.
What "multiple-broker" clients do not realize or understand is that I will generate a list of the "universe" of available apartments that will include virtually all of the other apartments that will be on these other brokers' lists. Do we simply run down the list and show apartments? Of course not. The only way to productively narrow down a list of several hundred apartments to the best deals and the most suitable for a given client is through the sheer experience of the agent, his ability to listen to his client and cull out the appropriate details, and the agent's ability to get knowledge and familiarity with the client's needs/tastes/preferences/etc. This "education" will often result in the broker making several immediate strong recommendations for the most suitable apartments. During the showing, the broker will get a "feel" from each reaction, comments and from followup questions, for such things as:
• Low floor or high floor
• Open layout or closed layout?
• Light over space? Space over light?
• Further downtown, or further uptown?
• Dark-stained floors? Light-stained floors?
• Buzzing neighborhoods or quieter streets?
• More living room, or more bedroom?
• More equal or less equal bedrooms.
• Front of street views? Or quiet courtyard solitude?
• Renovated apartment versus renovated building?
• Street or Avenue
and literally HUNDREDS of other comparisons/options/choices that span from the obvious to the obscure. In the span of showing several apartments and getting first-hand feedback from my client, I'm able to quickly assess which characteristics are the "must haves" and which can be sacraficed to get more of those "must have" features! In this way, over time I hone in on more and more "perfect" apartments, with often the most perfect at the end that leads to the application and the happy new tenant!
Now, what happens to the "multiple-broker" client? First of all, much as in the dating scenario, the lack of commitment isn't exactly the best way to motivate your broker to go "above and beyond" -- which is exactly what you need to score the best deal in New York City. So first and foremost, your broker knows he's just a "number," and has got a very short time to show you what he can before you're running off to the next. There's simply little motivation and no time to build a productive working relationship on that, and just as the broker may begin to be getting a great sense of that "perfect" apartment for the client's needs, that client checks his watch and must then run off to the next broker. That next broker, of course, must start completely from scratch, learning anew all of those same minute details, and very possibly planning to show those very same listings!
And then what about those "special listings," we may have...a particular new listings not yet in the system, or some incredible value that the broker is holding for a favored client...does "Miss Multi-Broker" get this recommendation? Of course not...the fear would be that the multi-broker client might communicate this special deal to the other brokers. Like in many other areas of life, trust and commitment can pay off handsomely when you're starting with an excellent broker.
Bottom line: Forget the brokers for a minute and do YOURSELF the favor...when you've been referred to a top broker, give him/her your trust and full commitment and let him/her know that! Let his/her proven success become your successful apartment find...and it will! And then you will be ready with a great recommendation when your friend asks you, "Do you happen to know of a great broker in New York City?"
Tuesday, June 9, 2009
May 2009: Surprise! Vacancy rates plummet! Is this a recovery?
One of the biggest factors helping clients to get the best deals in this market has been the increasing vacancy rates. By February 2009, vacancy rates had practically doubled the year before, to just over 2%. While a 2% vacancy rate in any other city is a "severe housing shortage," for New Yorkers, accustom to a very tight housing market, a 2% vacancy rate means relative bargains, with low-end prices down approx. 6% over a year ago, and higher-end properties down much more. Now a 6% drop may not sound like, much, but compared to the typical 5 - 10% increase year-over-year, the difference between a drop versus an increase is much more substantial. In short, New York City has been "On Sale!"
We've been seeing a slow but consistent strengthening in the rental market since February, but with rents beginning to increase, there has been a sudden surge in demand throughout May and June. The May 2009 rental report (below) reveals a dramatic plunge in vacancy rates from 2.28% to 1.72% towards the end of May. Essentially, as bad as the economy may appear to some, people are moving to the city and taking advantage of the lower rents en masse! The very best deals have been snagged in Feburary and March but there still remain some great deals out there. I've had some clients waiting since January for rents to drop further, and they now realize that they've "missed the boat." It's not too late to grab a great deal, however, and of course I still am able to bring my clients to the very best values in the city regardless of market environment. The following rental report can be used as a guideline for recent changes in rents...
http://www.citi-habitats.com/media/pdf/2009-5-mra.pdf
We've been seeing a slow but consistent strengthening in the rental market since February, but with rents beginning to increase, there has been a sudden surge in demand throughout May and June. The May 2009 rental report (below) reveals a dramatic plunge in vacancy rates from 2.28% to 1.72% towards the end of May. Essentially, as bad as the economy may appear to some, people are moving to the city and taking advantage of the lower rents en masse! The very best deals have been snagged in Feburary and March but there still remain some great deals out there. I've had some clients waiting since January for rents to drop further, and they now realize that they've "missed the boat." It's not too late to grab a great deal, however, and of course I still am able to bring my clients to the very best values in the city regardless of market environment. The following rental report can be used as a guideline for recent changes in rents...
http://www.citi-habitats.com/media/pdf/2009-5-mra.pdf
Wednesday, May 20, 2009
Getting Prepared - What You Need to Rent an Apartment in New York City
Many prospective renters from out of town come to New York City expecting that they'll just find a pretty apartment, sign the lease, hand over a check and get a shiny new set of keys in return. Unfortunately, the experience of renting an apartment in New York City is not nearly so simple. In fact, many have compared the experience of RENTING in New York City as more involved than actually BUYING in many other cities!
Before you pack up your bags and choose another big city, it's important to understand exactly WHY the application process is so much more demanding. It really boils down to the strong tenant laws in New York. If a tenant does not pay his or her rent, New York City does not allow simple and immediate eviction, but rather an extended process involving housing court and a host of potential complications that can make it very time consuming and expensive for a landlord to evict anybody. The end result is that a landlord can lose tens of thousands of dollars in the process of trying to evict a non-paying tenant. To prevent that, landlords in Manhattan have become very careful and selective when it comes to the finances, employment and particularly credit history of prospective tenants.
The GOOD NEWS is that you can make this process vastly simpler and easier by simply preparing for it. And here's where I can offer some immediate assistance even before you see a single apartment. By compiling the documentation and information that you need, and reviewing your credit report to ensure that there are no "surprises," you can be ahead of 99% of all other renters. And that can come in VERY handy when your broker finds you that exceptionally good deal and lands it for you by virtue of your ready-to-go paperwork!
OK, JEFF, WHAT DO I NEED TO QUALIFY FOR AN APARTMENT RENTAL IN NEW YORK CITY?
An applicant will need to earn 40x the monthly rent. So to rent a $2,000/month apartment, the landlord would want to see the applicant earning $80,000 per year. Sure, there are many stories of people getting apartments with far less income, but these situations are far less common than the stories themselves. Virtually every reputable landlord will insist on these standards. If the applicant cannot meet the income requirement, or if the applicant has weaker credit, a guarantor, or co-signer, will be necessary. The landlord generally wants to see a guarantor earning 65x to 80x the monthly rent. The landlord may or may not combine incomes of multiple applicants/guarantors...your broker can guide you to the specific policy of any particular apartment in which you have interest. Some landlords will prohibit guarantors from certain states...basically, those states with homestead exemptions (e.g. Florida, Texas).
SO, JEFF, WHAT DO I NEED TO GATHER TO RENT AN APARTMENT IN NEW YORK CITY?
Assuming that you are financially qualified, or have a financially qualified guarantor, you'll need the following in almost every instance. These are not requirements of Citi-Habitats, rather these are the requirements of virtually every reputable landlord in New York City...
• CREDIT CHECK: Either we or the landlord will run credit/tenant report. Credit check fees can range from $50 to $100 per applicant and guarantor. The report includes eviction search, court records search, lien search, and other searches intended to assure the landlord of a problem-free tenant.
• LETTER OF EMPLOYMENT: You should ask your employer for a "Letter of Employment" almost immediately, since this is the one document over which you will be dependent on someone else getting to you in a timely manner. Since this can take several days, it's therefore best to ask for this IMMEDIATELY so you'll have it when you need it. If you have an older letter of employment, such as one when you started work more than 3 months old, chances are that the landlord will want to see an UPDATED letter of employment, so keep that in mind and ask for an updated letter to be on the safe side.
• FEDERAL TAX RETURNS (Form 1040): You'll want to gather your last 2 year's worth of federal tax returns. You don't need the whole return, or the city/state portions. Just the first and signature pages, and be sure to sign the return (e.g. if you're accountant left you with an unsigned copy).
• CURRENT BANK STATEMENT: Everybody of course likes privacy, but when it comes to getting yourself accepted into a good building, you'll want to show MORE not LESS. Choose the account with the highest balance, or if your money is spread among multiple accounts, bring multiple statements. If you keep most of your liquid assets in another type of account (e.g. a brokerage account) that can be an alterative to a bank statement. The goal here is to assure the landlord that you have well more than enough money for rent, living expenses, potential emergencies, etc.
• PHOTO ID: We'll make a copy for the landlord of a driver's license or passport with your photo and name/address clearly visible.
The following are supplementary documentation required by many reputable landlords:
• 3 MOST RECENT PAY STUBS: If you have direct deposit, bring your direct deposit stubs if you have them, or alteratively print out your bank statement and circle those msot recent 3 deposits.
• LANDLORD REFERENCE LETTER: Should state your name, dates of occupancy, and note that rent was paid in a timely manner. Ideally, this letter should be positive and mention that the landlord recommends you as a tenant, although we can't always get the landlord to type anything more than a basic reference letter. If you are currently living with parents, you can actually submit a letter from your parents attesting to that fact, and also assuring the landlord that you've been a good occupant. If you are subletting, provide the recommendation letter from the sublettor.
The following are often required by Condo and Co-op sublets...
• PERSONAL AND/OR BUSINESS REFERENCE LETTERS: Depending on the building, you may be required to provide letters from references stating how long they've known you, a summary of your character, etc.
In the case of a guarantor, virtually ALL of the same documentation listed above is required as well, however the "Landlord Reference Letter" is not needed for the guarantor.
WHAT IF I OWN MY OWN BUSINESS?
No worries here. In lieu of a "Letter of Employment," you'll get a CPA or accountant's letter stating your Annual Income for the past 2 years. Ideally, the letter can also approximate net worth, and discuss the line of business, and length of employment or self-employment.
Sound like a lot, right? But this is the biggest step you can take RIGHT NOW to securing your dream apartment.
Questions about the process? Don't hesitate to email me!
Before you pack up your bags and choose another big city, it's important to understand exactly WHY the application process is so much more demanding. It really boils down to the strong tenant laws in New York. If a tenant does not pay his or her rent, New York City does not allow simple and immediate eviction, but rather an extended process involving housing court and a host of potential complications that can make it very time consuming and expensive for a landlord to evict anybody. The end result is that a landlord can lose tens of thousands of dollars in the process of trying to evict a non-paying tenant. To prevent that, landlords in Manhattan have become very careful and selective when it comes to the finances, employment and particularly credit history of prospective tenants.
The GOOD NEWS is that you can make this process vastly simpler and easier by simply preparing for it. And here's where I can offer some immediate assistance even before you see a single apartment. By compiling the documentation and information that you need, and reviewing your credit report to ensure that there are no "surprises," you can be ahead of 99% of all other renters. And that can come in VERY handy when your broker finds you that exceptionally good deal and lands it for you by virtue of your ready-to-go paperwork!
OK, JEFF, WHAT DO I NEED TO QUALIFY FOR AN APARTMENT RENTAL IN NEW YORK CITY?
An applicant will need to earn 40x the monthly rent. So to rent a $2,000/month apartment, the landlord would want to see the applicant earning $80,000 per year. Sure, there are many stories of people getting apartments with far less income, but these situations are far less common than the stories themselves. Virtually every reputable landlord will insist on these standards. If the applicant cannot meet the income requirement, or if the applicant has weaker credit, a guarantor, or co-signer, will be necessary. The landlord generally wants to see a guarantor earning 65x to 80x the monthly rent. The landlord may or may not combine incomes of multiple applicants/guarantors...your broker can guide you to the specific policy of any particular apartment in which you have interest. Some landlords will prohibit guarantors from certain states...basically, those states with homestead exemptions (e.g. Florida, Texas).
SO, JEFF, WHAT DO I NEED TO GATHER TO RENT AN APARTMENT IN NEW YORK CITY?
Assuming that you are financially qualified, or have a financially qualified guarantor, you'll need the following in almost every instance. These are not requirements of Citi-Habitats, rather these are the requirements of virtually every reputable landlord in New York City...
• CREDIT CHECK: Either we or the landlord will run credit/tenant report. Credit check fees can range from $50 to $100 per applicant and guarantor. The report includes eviction search, court records search, lien search, and other searches intended to assure the landlord of a problem-free tenant.
• LETTER OF EMPLOYMENT: You should ask your employer for a "Letter of Employment" almost immediately, since this is the one document over which you will be dependent on someone else getting to you in a timely manner. Since this can take several days, it's therefore best to ask for this IMMEDIATELY so you'll have it when you need it. If you have an older letter of employment, such as one when you started work more than 3 months old, chances are that the landlord will want to see an UPDATED letter of employment, so keep that in mind and ask for an updated letter to be on the safe side.
• FEDERAL TAX RETURNS (Form 1040): You'll want to gather your last 2 year's worth of federal tax returns. You don't need the whole return, or the city/state portions. Just the first and signature pages, and be sure to sign the return (e.g. if you're accountant left you with an unsigned copy).
• CURRENT BANK STATEMENT: Everybody of course likes privacy, but when it comes to getting yourself accepted into a good building, you'll want to show MORE not LESS. Choose the account with the highest balance, or if your money is spread among multiple accounts, bring multiple statements. If you keep most of your liquid assets in another type of account (e.g. a brokerage account) that can be an alterative to a bank statement. The goal here is to assure the landlord that you have well more than enough money for rent, living expenses, potential emergencies, etc.
• PHOTO ID: We'll make a copy for the landlord of a driver's license or passport with your photo and name/address clearly visible.
The following are supplementary documentation required by many reputable landlords:
• 3 MOST RECENT PAY STUBS: If you have direct deposit, bring your direct deposit stubs if you have them, or alteratively print out your bank statement and circle those msot recent 3 deposits.
• LANDLORD REFERENCE LETTER: Should state your name, dates of occupancy, and note that rent was paid in a timely manner. Ideally, this letter should be positive and mention that the landlord recommends you as a tenant, although we can't always get the landlord to type anything more than a basic reference letter. If you are currently living with parents, you can actually submit a letter from your parents attesting to that fact, and also assuring the landlord that you've been a good occupant. If you are subletting, provide the recommendation letter from the sublettor.
The following are often required by Condo and Co-op sublets...
• PERSONAL AND/OR BUSINESS REFERENCE LETTERS: Depending on the building, you may be required to provide letters from references stating how long they've known you, a summary of your character, etc.
In the case of a guarantor, virtually ALL of the same documentation listed above is required as well, however the "Landlord Reference Letter" is not needed for the guarantor.
WHAT IF I OWN MY OWN BUSINESS?
No worries here. In lieu of a "Letter of Employment," you'll get a CPA or accountant's letter stating your Annual Income for the past 2 years. Ideally, the letter can also approximate net worth, and discuss the line of business, and length of employment or self-employment.
Sound like a lot, right? But this is the biggest step you can take RIGHT NOW to securing your dream apartment.
Questions about the process? Don't hesitate to email me!
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