When searching for apartments for rent in New York City, it is not uncommon to hire a broker to help you find a place. In fact, it can take down the stress that comes with moving to such a big city. However, it should be noted that you are going to have to pay a broker fee. The following guide can help you break down the broker fees in New York.
What Is A Broker Fee?
A broker fee is the amount you owe your broker when they help you find an apartment. Remember, you are hiring the broker to take care of your apartment hunting, so you are going to have to pay them for their service. You can think of it as their commission for successfully helping you find a place. Plus, it is a fee set by their brokerage.
How Much Is The Broker Fee?
You want to find out how much you are going to pay in fees before you hire a broker. The broker fee is usually 8 percent of your monthly rent or 15 percent of your annual rent. If your monthly rent is $2,000, a broker fee is going to add in an additional $3,600. It does not matter if you or your broker found the apartment, you are still paying them a fee for their service, as they have taken their time to help you find and obtain an apartment.
Negotiating A Broker Fee
While it is not guaranteed, there is always a chance of negotiating the fee with your broker. Your broker may agree to negotiate their fees if the market is slow or in an off-season, or if you are looking at a more expensive apartment. You may even be able to offer them a referral or positive review in exchange for a lower fee. Now your broker knows that if you walk away, they do not make anything, but you should keep in mind that New York City apartments are not scarce.
Remember The Brokerage
If you are planning to negotiate the broker fee, remember that your broker still has to answer to their brokerage. Your broker may have to pay a portion to their brokerage, and some brokerages do not allow their brokers to negotiate the fees. It is best to find out if the 15 percent is required, or if there is room for negotiation, before hiring a certain broker. This way, you can determine if you need to find another broker or take care of your own apartment hunting.
Who Decides The Broker Fee?
Now, the broker fees may vary per listing, but it is usually an agreement between the broker and landlord. You already know that the fee is split between your broker and their brokerage, and this is usually agreed upon both parties in advance. Remember, the brokerage may still require your broker to charge a certain amount for the fee.
Look Out For Dishonest Brokers
It is important to keep the 15 percent fee in mind, as you may come across a broker who requests a higher broker fee. The standard fee for your annual rent is 15 percent, and any broker who claims it is higher is trying to take advantage of the situation. It is also important to avoid signing anything until you are ready to apply for your apartment. You are not required to sign anything prior to filling out your application.
If you need a broker to help you find an apartment in NYC, it is best to add the standard broker fee to your budget, so you are not surprised by a higher cost.
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