WHAT DO I NEED TO KNOW ABOUT RENTING A MANHATTAN APARTMENT
There is a lot to know about renting a Manhattan apartment. It's not as easy as it is in other cities. It is necessary to be fully prepared so that when you see an apartment that you want to rent, you can get it!
You must be prepared to bring the following items with you when searching for an apartment:
- A letter from your employer stating your current salary, guaranteed or potential bonus (if applicable), title, start date, and housing allowance, if any
- Copy of your passport or driver's license
- Last year's tax returns (or Letter from C.P.A.)
- Most recent bank statement
- Travelers checks or personal checkbook
You must have enough funds in your bank to pay the following in order to secure your apartment:
- First month's rent
- Security deposit (usually 1-2 month's rent)
- Brokerage fee (if applicable, 15% of the annual rent)
- Application fees (for rental buildings up to $250; for condominiums and cooperatives, up to $2,000)
Once you find an apartment that you want, you will be asked to complete an application and usually pay a credit check fee to the broker or landlord in order to run the credit report.
Next, the broker or landlord will tell you if your application and credit have been approved. If you are preliminarily approved, you will be asked to provide the broker or landlord with certified checks or money orders for rent, security deposit and broker's fee, as applicable. You will be expected to have the funds within one to two business days of receiving preliminary approval in order to secure the apartment. Finally, you will be asked to sign the lease agreement prepared by the broker or landlord. Once both you and the landlord sign leases, you can feel safe that the apartment is yours!
Most landlords require that tenants earn approximately 40 to 50 times the rent. If financial conditions are not met, a landlord may require that the prospective applicant secure a co-signer or guarantor. Landlords prefer a guarantor who lives in New York, New Jersey, or Connecticut. The guarantor must earn ample income, often as much as 100 times the amount of the rent. The guarantor will be required to complete an application and provide proof of income.
Landlords typically wonít combine household incomes to get to that ratio, but there are exceptions if both/all applicants hold jobs that show adequate income. If you are self-employed and show adequate gross income but your net income doesnít qualify you for the landlordís formula, you might have to show the landlord substantial liquid assets in order to be considered for the apartment. (Cash, certificates of deposit, stocks, etc.) Owned homes, cars, fine arts, antiques, jewelry and other such valuables are not considered liquid assets. Retirement accounts will usually count but only a fraction of the assets, unless you are of retirement age when you can liquidate your assets without a penalty.
Types of Ownership
Rental Buildings — Landlord owns the entire building. Stabilized and non-stabilized units fall under this category. The approval process is the fastest with rental buildings, taking up to a week.
Condominiums (Condo) — Apartments are owned by individuals for residential and/or investment purposes. Owners are free to establish rent and length of lease. The approval process usually takes between 10-30 days. Expect application and move in fees.
Cooperatives (Co-ops) — Buildings are structured as a corporation. Individual's own shares in the corporation according to the size and value of their unit. There are many restrictions on the rentals (sublets) of co-ops, regarding length of lease, roommates, etc. Co-ops can be problematic for internationals, students or those individuals without an established credit history. Also, most are not pet-friendly to renters. The approval process with co-ops can take 30-45 days, usually requiring extensive financial data and a meeting with the Co-op's board of directors.
You can rest assured that with the help of your Schwab Realty rental agent, renting an apartment in New York City will be a pleasant and productive experience.