Having looked for an apartment in the NYC area a few times for the past few years I can say that the market is a mess. The real estate industry is big but the experience is expensive, inefficient and time consuming. There is a lot of money in real estate so it attracts a variety of companies that try to solve these issues but no one succeeds.
When you start looking for an apartment, you have three choices.
1. Contact a real estate agent and have them show you apartments
- It’s easier.
- It’s less time consuming, the agent aggregates a few apartments and shows the to you on a specific time.
- An agent in Manhattan wants 15%(!!!) of the yearly rent as a fee. Outside of Manhattan it’s a one month fee which is more reasonable but still very expensive. It means that even before you get into your new apartment and start overpaying for rent, you need to pay a few thousand dollars to the agent.
- You will most likely see the worst apartments in the market that you could find yourself online. It didn’t happen once that I saw a good apartment on the first showing. Usually it’s the ground floors or the 4th floor and up in a no elevator building.
- Most agents will ask you for your budget and then show you apartments for a few hundred dollars more.
- All agents always say upfront that they have access to all the apartments in the city that all the other agents have so there’s no point contacting anyone else. Which is of course not true because unless you monitor new apartments by yourself online you will not know about a good apartment on time.
2. Look for apartments on your own online and contact the agents that published them
- There is more control and you see a bigger variety of apartments and agents.
- You still end up paying the fee to the agent that posted the ad.
- The majority of the ads (all of them besides maybe 2-3) are apartments that have been on the market for at least a month and no one wants.
- Some of the ads are old apartments that were rented already but the agents keep them so people will contact them. They then say that the apartment was just rented but they have other similar ones.
- Very time consuming.
- Most of the ads have missing information, some don’t have pics. The worst ones have a tiny close ups on the sink or the skyline view of Manhattan.
3. Contact a leasing office of a rental building
- No Fee!
- Rental buildings usually have a much higher standard of apartments
- You will need to call a lot of buildings until you find ones with available apartments for a good price.
- The monthly rent in these buildings are usually higher and the apartments are smaller.
There are a few startups that try to solve these problems but none of them comes close (unless I’m not aware of something). It seems like there is a big opportunity to cut out the agents and have a marketplace that will enforce strict rules on ads - require full information and somehow verify the authenticity of the ads while also making sure that irrelevant ads are taken off immediately. I’ve read that there are many laws and regulations that protect agents so maybe that is the reason it hasn’t been done yet.