Saturday, November 8, 2008

The Tide is Turning for New York City Rentals

"Why is it so hard to rent an apartment in New York City?" I had a young woman relocating from San Francisco ask me this question just a few weeks ago after we found her an apartment in the Upper West Side. The other statement I usually here is, "I'm so sick of looking for an apartment!" Despite the difficult nature of finding an apartment in Manhattan things might be getting a little bit easier.

As the Manhattan real estate market turns into a buyer's market, many buyers are becoming renters to wait out and see what happens to the market. Typically the summer market for rentals is very hot and properties get snatched up very quickly. Not so much this summer, properly priced units still rented quickly but more inventory sat until the prices adjusted. Now that we are into the fall season the rental market has started to slow down and the holidays now are just around the corner. Landlord are beginning to ease up on rents and offering more room to negotiate.

Many of the major management companies are offering one and sometimes two months free rent for 12-16 month long leases, offering built in gym memberships, and negotiating prices. I find that landlords would rather offer incentives, such as one months free rent, a free gym membership, compared to significantly reducing the rents because when it is time to renegotiate the rents when the leases are up they will be in a better position because the base monthly rents will be inflated. The net effective rent during the life of the lease was considerably less and when the leases are up they will expire in January to March when the rental market is seasonally stronger and the landlord will be in a better position to negotiate a new lease.

Overall this is a good time to be in the market for a rental apartment. Whether you are looking for a walk-up building in the Upper East Side, a full service doorman condominium in Union Square, or a prewar Upper West Side co-op there are plenty of opportunities to negotiate favorable terms and find the perfect apartment.


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