According to the latest New York City rental market report prepared by Miller Samuel Inc. for Douglas Elliman Real Estate, price trends are weakening as landlords are offering concessions to fill vacancies. Because of these concessions, the net effective median rent for July 2017 declined for the first time in at least five years.
Hal Gavzie, Executive Manager of Leasing at Douglas Elliman spoke with us about the state of the rental market. Here are his answers to our questions and some useful tips for negotiating your rent.
Do renters have any power to negotiate their rent?
Typically, rent negotiations are more prominent during the slower months, November through March. Currently, however, there is an abundance of inventory, both new developments and existing rentals, many of which are offering landlord concessions, for example, free rent or discounted broker fees. This combination seems to be allowing for more negotiating from customers than seen in previous years.
For existing tenants looking to renew their leases, we have seen some room for negotiating new leases depending upon the current building vacancies and time on market.
What percentage off is reasonable for a tenant to ask for?
This depends on a few factors, but generally, within a certain price point we see landlords considering offers ranging from $50 to $100 below the asking rent.
What features or circumstances lend more to negotiating price?
The most common circumstance is days on market, the longer an apartment has been available, the more likely the owner will consider an offer. Other factors may include the amount of vacancies available within a specific building, offering an immediate lease start date and being a strong financial applicant always helps.
If there are added fees for common areas, pets, gym, etc., can they be negotiated?
We have seen owners agreeing to waive certain building amenity fees for new leases as an additional incentive to close the deal. Currently, this has been more common within new development rental buildings.
Is it worthwhile to increase the term of your lease from 1 year to 2 years to lock in a price?
This tactic may work on a case-by-case basis. If a one month free rent concession is offered on a 12-month lease, try asking for two months free rent on a 24-month lease. Your net effective rent will be lower and the landlord doesn’t have to worry about finding a new tenant for two years. Of course, landlords are most concerned with getting their asking rents and making sure they have well qualified tenants.
Read more about the rental market by downloading the latest report, or search for your next apartment.
Meet the Expert:
As Executive Director of Leasing at Douglas Elliman, Hal Gavzie oversees the Manhattan and Brooklyn leasing sector and has a key role in the expansion of the leasing division. Hal uses his expertise to assist his agents, customers and landlords with searching for the right apartment, negotiating rents, or pricing new properties. Leveraging his extensive market knowledge and longstanding relationships with landlords and property management entities, he seamlessly assists his agents with the toughest real estate transactions. Hal is an active member of the Real Estate Board of New York.