Party's Over For Rent Concessions

It was just a few months ago that the pricey rent concessions some buildings and landlords were being analyzed, but lately it seems like some landlords want their tenants to...pay more. One Midtown tenant who is facing an apartment lease renewal sans concessions (like a month's free rent) told NY1, "It is shocking to see numbers jump like that, especially for someone who is new to the city. I obviously don’t know what the New York City real estate game is like, but as a renter who is new, who experienced an unbelievable deal coming here, it was shocking for me to be faced with those numbers."

His broker explained, "[Tenants] taking a hit, because in their mind they are paying $2,500, even though their legal rent is $3,000. They go to renew and they think their rent is being raised to $2,800 or $3,000, but in reality the free months are just being taken away." (Rent increases have been tested by landlords since earlier this year, to take advantage of the slow economic recovery.)

According to CitiHabitats, the rental vacancy rate is at 1.1% for August, up from 0.88% in July (apparently it's unusual for the vacancy rate to go over 1%). One reason being cited is the end of rent concessions: Crain's New York reports, "In August, a mere 20% of apartments rented by CitiHabitats included concessions—typically giving a free month's rent or paying the broker's fee. That is drastically down from the peak of incentives in December 2009 when roughly 60% of apartments rented by the brokerage included concessions."

Contact the author of this article or email tips@gothamist.com with further questions, comments or tips.

By Jen Chung in News on September 15, 2010 4:08 PM

Comments [rss]

cmdrogogov

Newsflash - unaffordable housing in the middle of a depression results in vacancies!

Say it ain't so.

Perhaps if people weren't thick enough to pay top dollar to live in a shoebox, this wouldn't be an issue.

citylion

+1

citylion

Yeah, no sympathy for the newbie. Sorry...er, not really.

I grew up downtown and the inflation rate of an apartment at market rate from say even twenty years ago to now...I'll give you something to whine about.

To quote another gothamist headline "stfu".

I little roach just ran past your feet playing the smallist violin.

bonu$baby

Okay based upon that quote, are we supposed to institute rent control just for people that are "new" to NY?

Go home if you can't hack it.

jamieob256

Yeah, go back to where you came from.

jles

I've said it before and I'll say it again:

How ridiculous is it that we get all of our information on NYC rental prices from CitiHabitats!??! They're a BROKER, and they directly benefit from INFLATING REAL ESTATE PRICES.

It's smells like fraud in here.

dcs123

It's just like liz lemon said on 30 rock...there are no rules in nyc real estate!!!!

nicemarmot

That's not too bad compared to how it was three years ago. We lived in Peter Cooper Village and when Rose Management raised our rent $400 a month in 2006 we decided to start looking for a new place - preferably a better one. But everything was so insanely expensive - everytime we found a place we liked it was either just too much for us to stomach, or someone else would snatch it up while we were still at our offices. We wound up not moving and paying the $400 extra a month. Then Tishman Speyer bought the toilet - er, I mean, complex - and proceeded to tell us we now lived in a "luxury building" and they were going to raise our rent $600 a month for a one year renewal, and $800 a month for a two-year renewal. Which, had we renewed for one year, would have made our rent $3600 for a one-bedroom. In Peter freaking Cooper. They then proceeded to get rid of most of the maintenance and landscaping departments, and we began having non-stop plumbing issues, culminating in some sort of purplish-red sewage backflowing out of our tub and all over the bathroom and the hallway. When we called the maintenance department, they told us MAYBE they could come on Tuesday. It was a Friday.

We wound up buying a place - we wanted a bigger apartment in a better location and in early 2007 that would have meant paying an utterly absurd rent. We knew there was a bubble, but we figured it would peak in '08 or '09, and we didn't want to wait that long in our sewage tank, uh I mean PCV apartment. We signed our contract in June '07. Ooops.

So yeah...quitcher bitchin, renters, for not getting your free month. You've still got it good compared to just a few years ago.