Many of my out-of-town clients are not familiar with the vacancy rate in New York City, nor how quickly apartments rent. In these terrible economic conditions, Manhattan's vacancy rate has about doubled from September 2007 to January 2009, which sounds astounding for a moment until you realize that in September 2007 the vacancy rate had dropped to an astoundingly low 1% and is now around 2%. In other words, as the world seems to be falling apartment, Manhattan's vacancy rate is the still among the lowest in the world, and screams "We're totally full!" It's become a bit easier to rent in Manhattan, but the housing shortage has not disappeared.It's very important to keep that in mind when you're beginning to plan your search for an apartment. While it seems to be common sense that the earlier you start, the better, starting too early in Manhattan can be counterproductive.
What makes Manhattan so unique is that due to the very low vacancy rate and the huge demand for housing here, great apartments do not sit empty for very long. In fact, some apartments go directly from one tenant, to a quick cleaning and painting, and to the next tenant, in a matter of days! The apartments that DO sit around for several weeks or more, are not apartments that anybody is going to be jumping up and down about...they're usually apartments with serious flaw or other problems that have kept them from renting.
So let's take the example of my out-of-town client who needs an apartment for September 2009. They call me in March 2009 to set up an appointment to view apartments because they want to plan as far ahead as possible as this would seem to be the strategy to get the best apartment possible. Right? Unfortunately, not in New York City.
So what happens? First of all, there are simply no apartments available 6 months ahead of time, and not very many even 1 month ahead of time. Most of those tenants who will be vacating in September 2009 probably have NO IDEA YET whether they may even renew or stay in their current leases. So nobody...not the landlord, not the broker, not the tenant can even know what apartments may become available so many months ahead of time.
But in some cases, the client has already traveled from overseas or another state, and didn't get a chance to call me until he arrived in New York. So he would like to see some apartments. So what happens now? I will show him some apartments, including some of my best properties, and he may well fall in love with a particular property. But unfortunately, that property will be ready to rent NOW, or in some cases we can negotiate a few weeks later start date. If he doesn't rent this beautiful apartment, of course someone else will rent it. Yet he can't possibly begin renting, say, April 1st and paying 5 months of rent just for the sake of having an apartment in September. So that's the inherent problem and frustration with trying to rent in Manhattan so far ahead of time.
But what about coming ahead of time to "get to know the market?" or to "see some example apartments?" There can be some value to that, but keep in mind that apartments in Manhattan are very much like people: each available apartment is very different and unique from any other. Manhattan housing stock is well-established, and we do not often get brand new rentals where we have a "stock" of multiple apartments where one can see a representative sample of what they may rent later down the road. Furthermore, the market can change quickly in New York City. Landlords are quick to adjust their rents downward when market conditions require, because they do not want to leave apartments sitting vacant for any extended period of time. And on the other hand, as the economy recovers, landlords will most certainly begin resuming the increases in rents, because market demand will allow them to earn a greater return on their investments. Bottom line: what the advance-planning client sees today will likely have little resemblance to what he might ultimate come to see several months down the road when it's the right time to rent.
SO, JEFF, WHEN IS THE BEST TIME TO BEGIN SEARCHING FOR AN APARTMENT?
Unless you know that you will be applying for a co-op or condominium sublet, which are more complicated types of rentals that require significant documentation, time and often a board interview, you should plan to arrive in New York City approximately 2 to 3 weeks before you intend to sign your lease. This would allow you up to a full week to view properties, another week to gather paperwork, get approved, and schedule the lease signing. But this is just a guideline. In fact, I've had clients walk into my office needing an apartment "today" and have been able to find, apply, and conduct a lease signing all in the same day. Of course, that's an extenuating circumstance but the point is that in New York City, months of advance planning is not the trick to finding a great apartment. The key is to work with a reputable, trusted and talented broker who will quickly guide you to the best values in your price range, and help get you approved for your desired apartment in the shortest time possible.
