Monday, February 23, 2015

How an Out-of-Towner can find a NYC Apartment to Rent

What is the first thing you should know about finding an apartment in New York City as an out-of-towner? Go in with your eyes open.  Be prepared and aware of the costs involved.  Based on our experiences, I will try to break this down.  We knew it would be expensive, but we were clueless as to how expensive it actually is.  We didn't really do our homework, because we were relying on our daughter to do it for us.  Here's what she told us:  I want to live in Manhattan in the financial district; I want a doorman, I want a rooftop deck, I want laundry in the building, I want easy subway access, and I want a gym in the building.  Ok, that all sounded great.  She made a few calls, and a nice, young broker called us back.  I explained that we did not want to pay a broker's fee, and he responded by saying he had lots of listings with fees paid. We were off to the city to look at apartments.
Yes, you can secure apartments without a broker, but I don't see how, especially if you are out of town.  Apartments go so fast that you can't look too far in advance, and when you find one, you have to be ready and jump on it quick.
We met our nice, young broker downtown and began our search.  The apartments he showed us were small.  I do mean small.  How were two females going to share a space this small without killing each other in the process?  We walked and looked at many apartments.  He explained to us that securing a one-bedroom and converting it to a two-bedroom, would be the way to go.  Problem was--it didn't seem that the one-bedrooms were big enough to convert to two.  We eventually went back to the first one he showed us, because it was on a quiet street, it looked safe, and the occupants and doorman seemed nice.
This is the actual building which housed the apartment we chose.  Now came the hard part.  Since we were co-signing as guarantors, we had to have documents in and notarized quickly.  Sometimes they want them within a 24-hour time period.  Here's what we had to show:

  • Application form: We filled out the application the day we found and decided on the apartment.  My daughter's roommate's co-signor wasn't with us, so they had to fax it in later.

Try to have these documents ready to go before the apartment search:
  • Letter of employment: On company letterhead.  A letter of intent won't work.  We are self-employed, so this wasn't part of our document package.  
  • Pay stubs: A copy of your three most recent pay stubs--renters and guarantors.
  • Tax return: Some management companies require a copy of your most recent federal tax return. This was important, because as I said, we are self-employed.
  • Landlord reference letter: Our daughter sent in a letter from her landlord when she lived in our town.
  • Bank statements: Your three most recent statements from your checking account, savings account or any financial institution should do.  They also asked us for current statements from investments--IRA's, stocks, bonds, etc.
  • Bank account numbers: Are often required on application forms. Have them ready just in case you need them.
  • References: Not always required, but since we were out-of-state, they were.
  • Identification: Many landlords require a copy of a photo ID at lease signing.

These documents were required because they want guarantors to earn 80 times the monthly rent, and renters to show 40 times the monthly rent.  Not sure what young person just starting out makes that kind of money, especially struggling artists, but I'm sure some do.  

We sent in all the necessary documents, and took a deep breath when they discussed costs.  Here is a breakdown:

Application fee--$75-$200 for each rentor and guarantor.  This usually covers the cost of a credit report, which is run on all applicants and guarantors.

Security Deposit--One to two months' rent.  They required two months' rent for us, since we were from out-of-town.

Broker's fee--Ours was prepaid, but it didn't feel like it at the time.  Usually, it is 10-15% of contract rental amount.

First month's rent--must be paid in advance.

The monthly rent was a little over $3,000, shared between the two girls.  So, let me try to add up all the initial costs:  $200 (application fees for 2 applicants--not including roommate), $6100 security deposit divided by two--$3050, one month's rent in advance--$3050 divided by 2--$1,525.  Total of $4,775! Now, mind you, that does not include the costs to get there and home.  Or the hotel stays while you are searching.  Or eating out. That quickly adds another $1,000 to the price tag, easily, maybe more.  In addition, a wall had to be built in the living area to accommodate another bedroom--price tag?  around $900.

To see pictures of this apartment in the financial district, click here.

Recently, my daughter and her roommate moved to Washington Heights.  The rent is much cheaper, $2,000 a month, and it is an actual two-bedroom, with more space.  We had to act quickly to get this apartment, which has no doorman, no roof-top deck, no gym, no laundry, and no elevator (luckily they are on the 3rd floor).  

Washington Heights is located in the northern-most part of Manhattan, but is only a 5-subway stop to my daughter's current job.  A lot of young people--students, struggling artists, and young families are now moving in the area, due to the lower costs.  

If you have any questions about this process, please ask in the comments section below.  Good luck with your search!  Now my daughter and her roommate are settled in, and you can see pictures of their apartment here!

Thanks for stopping by!!--Betsy

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