Park Slope Living at Manhattan Rents!

eggcream · January 2008

So, is this true from those of you in the market?

excerpt:
"But, oh, Brooklyn! What deals! Compared to Manhattan, Brooklyn apartments in the brownstone satellites like Carroll Gardens and Park Slope seemed—in fact, were—so cheap. And yet the neighborhoods looked and felt like nascent versions of SoHo or the West Village.

The latest numbers suggest this trend is ending. It’s not just that Brooklyn brownstone neighborhoods are getting comparably expensive to Manhattan; it’s that they’re getting a lot more expensive at a time when Manhattan seems to have topped out."

http://www.observer.com/2008/park-slope-living-manhattan-rents

daniel · January 2008

In 2005, the median monthly rent for Park Slope and Carroll Gardens in Brooklyn was $1,090, according to the Furman Center for Real Estate & Urban Policy at New York University. Now, barely two years later, the Park Slope median is $3,050,

I wonder what percentage of that increase is due to people renting out entire brownstones, as is the case two doors down from me, rather than astronomical growth in the price of 1-2 bedroom apartments.

arock75 · January 2008

My wife and I pay over $2k for a 1 BR with garden in PS. We moved out of a studio in Manhattan (Murray Hill) that was below market at $1600. We have begun looking for a bigger apartment and are finding 2 BR+ goes for at least $2500 in PS. It seems as though brownstone Brooklyn is still cheaper than Manhattan but the gap seems to be closing. If you were to make a direct comparison between premium neighborhoods in Brooklyn and Manhattan rent I'm sure Manhattan would still be far ahead. If you compare just the whole borough for each then I think that is too general and not a good way to compare.

nykittyny · January 2008

Subject: From a broker....

I dont remember having any inventory that went for $1050 in 2005...but we sure did have a lot more $1200 studios. Seems like the same studios now rent for $1500. Apartments that I rented for $3200 a few years ago now go for closer to $5000.

I know you may all think that brokers love this upward trend, but we don't. First of all, I pay rent as well, and my rent gets raised also. Second, people are more reluctant to move when the costs are so high - so fewer people are looking, and paying brokers fees.

santa · January 2008

ive seen some $1300 studios on craigslist lately in the north park slope

evilbert · January 2008

Subject: Re: From a broker....

NYkittyNY wrote:
I know you may all think that brokers love this upward trend, but we don't. First of all, I pay rent as well, and my rent gets raised also. Second, people are more reluctant to move when the costs are so high - so fewer people are looking, and paying brokers fees.

are you a broker? Got a question..

Why do brokers charge a percentage of the rent as their fee? Why not charge a flat rate per rental? How is renting a $3000 apartment more work than a $2000 one?

You said yourself the upward trend of rents is affecting your business, but charging a % of the rent is exacerbating the problem.

raw · January 2008

Subject: Re: From a broker....

Evilbert wrote: [quote=NYkittyNY]
I know you may all think that brokers love this upward trend, but we don't. First of all, I pay rent as well, and my rent gets raised also. Second, people are more reluctant to move when the costs are so high - so fewer people are looking, and paying brokers fees.

are you a broker? Got a question..

Why do brokers charge a percentage of the rent as their fee? Why not charge a flat rate per rental? How is renting a $3000 apartment more work than a $2000 one?

Good question.

meganlibrarian · January 2008

Subject: Re: From a broker....

raw wrote: [quote=Evilbert][quote=NYkittyNY]
I know you may all think that brokers love this upward trend, but we don't. First of all, I pay rent as well, and my rent gets raised also. Second, people are more reluctant to move when the costs are so high - so fewer people are looking, and paying brokers fees.

are you a broker? Got a question..

Why do brokers charge a percentage of the rent as their fee? Why not charge a flat rate per rental? How is renting a $3000 apartment more work than a $2000 one?

Good question.

Seconded!

This all kinda freaks me out, as my husband and I will be on the market next winter for a 2BR (baby arriving in April, lease expires for Feb 2009). We used to live in PS, and moved to PH in order to rent a nicer 1BR. I'm really beginning to wonder if we're going to have to move waaaaay the heck out into the farthest reaches of Brooklyn in order to be able to afford both our rent and daycare. We'd love to buy a place, but we can't afford a 2BR (or, heck, 1BR) condo and the percentages down on co-ops are ludicrous.

(I just had to marry a magazine editor for love rather than an i-banker for money. Ha.)

armchair_warrior · January 2008

"The Observer by research firm StreetEasy.com"

the problem is they use streeteasy they should of use rentometer instead. also they are comparing crappy hells kitchen to park slope two different animals.

caseopele · February 2008

Subject: Re: From a broker....

Evilbert wrote: Why do brokers charge a percentage of the rent as their fee? Why not charge a flat rate per rental? How is renting a $3000 apartment more work than a $2000 one?

I've never understood this, especially since I worked for a realtor one summer years ago.

mr. met · February 2008

it makes sense. if you sell something more expensive, you should get a bigger commission.

i sold watches for a few months when i got out of college. you don't get the same amount of money for selling a casio as you do for a breitling.

santa · February 2008

but the person buying the watch doesnt pay you the commision

mr. met · February 2008

yea, it's not exactly the same situation, but the same principle still applies i guess.

sweet tea · February 2008

Santa wrote: but the person buying the watch doesnt pay you the commision

of course they do. the customer always pays the commission. it's just a question of whether it's listed as a separate price.

cat · February 2008

Subject: not exactly...

sweet tea wrote: [quote=Santa]but the person buying the watch doesnt pay you the commision

of course they do. the customer always pays the commission. it's just a question of whether it's listed as a separate price.

Well, apparently, it was not always this way in NYC and it's not this way elsewhere. At one time, the landlords paid the rental fees.

And the person's point is if you are a person bringing your watch to a shop to be sold by a salesperson, YOU take a cut off of the price that it's sold for, the person who purchases it does not pay EXTRA. ??

sweet tea · February 2008

right, and my point is that a reasonably intelligent seller will factor the cost of commission into the price.

in chicago, it works the other way -- landlords pay any broker fee. in theory, this means that broker-shown apartments are a bit more expensive than an equivalent by-owner place, and in my experience that is often true. brokers are not really necessary there, but they do make things easier, and people expect to pay more for the rent than they would if they found a place on their own.

one difference between this and the watch scenario, is that unsold inventory of watched doesn't cost the dealer nearly as much as unrented apartments cost their owners. therefore, while it makes sense for 100% of the watch commission to be built into the price, it may be that less than 100% of the broker commission is built into the rental price, since a speedy broker also saves the LL the cost of carrying an unrented apartment.

here, it seems, brokers are seen as potentially getting you into an apartment with better rent or amenities than you would find on craigslist, etc, so the fee is assessed to the renter up front. since it's such a competitive market, the LL benefits less from using a broker than the renter does -- it's convenient for the LL, but the place would rent anyway. i don't like the system, either, but it does make sense to me.

nykittyny · February 2008

Subject: Not the place for a discussion/defense of broker's fees....

I don't want this forum to be a place where I defend broker's fees...I simply try to add helpful advice/knowledge from a real estate prospective when a real estate topic is started.

I am not in charge of what our fees are. My boss is. I have the right to negotiate to a certain point with my customers. I have been doing this for five years, and the standard fees were already in place. I personally believe that landlord's should always pay our fee. Unfortunately, the average landlord does not agree.

My point was not to do with people's feeling on broker's fees, but rather their reluctance to move because of rising rental prices. People are realizing that they are often better off staying where they have been for a few years. Me included. I pay $2250 for rent, and I could easily rent my own apartment out from under me for $2600.

gags2008 · February 2008

I understand that realtors are supposed to provide a "service" but what service they provide is hardly justified by these ridiculous fees. A month and a half? I could see that it made sense back in the day when there was not a thing called the Internets, rents were a lot cheaper, and you had to go somewhere to find a listing. (I'm talking rentals here).

The only justification for the fee seems to be on the landlords end; I mean realtors provide a credit check on the applicants and show the apartment for the landlord. They never seem to tell you that the landlord sucks, as they often do.

You would think that the landlord would pay the fees since a person looking for an apartment can go to a no-fee situation and avoid the fee, and rent someone else's apartment. The landlords are the ones "hiring" the realtor for their services, moreso than the renter, it seems to me. Maybe I'm crazy.

nykittyny · February 2008

Subject: I mostly agree with you....

gags2008 wrote: I understand that realtors are supposed to provide a "service" but what service they provide is hardly justified by these ridiculous fees. A month and a half? I could see that it made sense back in the day when there was not a thing called the Internets, rents were a lot cheaper, and you had to go somewhere to find a listing. (I'm talking rentals here).

The only justification for the fee seems to be on the landlords end; I mean realtors provide a credit check on the applicants and show the apartment for the landlord. They never seem to tell you that the landlord sucks, as they often do.

You would think that the landlord would pay the fees since a person looking for an apartment can go to a no-fee situation and avoid the fee, and rent someone else's apartment. The landlords are the ones "hiring" the realtor for their services, moreso than the renter, it seems to me. Maybe I'm crazy.

While I mostly agree with you, particularly that the LLs should be the ones to pay the realtor fees, I dont want to start a whole thread on a defense of broker's fees. But you are not crazy, we as rental agents are in fact representing the LL, and the fee that the LL would be charged is passed on to you, the renter.

gags2008 · February 2008

Well as to the original poster's question, yeah. Brooklyn, or Park Slope and Brooklyn Heights, has/have caught up to and surpassed SOME neighborhoods in Manhattan. Maybe not Park Avenue, Union Square, the West Village, or even the Upper West Side.

But did anyone not already know this by now?

landlord · March 2008

Subject: Park slope rent

I recently rented a prime slope large 1 bedroom for 1500. although I can get more for the apartment, I would rather rent it quickly to someone I trust will keep the apartment in good shape. So there are deals to be found. However, They don't last very long. For the past 5 years I always rented my apartments within 24 hours of posting them on craigslist.

smallbiz475 · March 2008

I have moved twice in the last 8 years. I noticed that rents especially in Brooklyn Heights dropped substantially after 9/11. This was probably due to the long-recession that hit nyc and especially lower manhattan. Since then Wall Street has taken off and so many high income earners have discovered the benefits of brooklyn. With that discovery has come large demand and substantial increases in rents (and prices across the board).

Eventually the bursting housing bubble and nationwide recession will be coming to brooklyn, however, it is difficult to understand their exact impact on rents. One could make arguments that rents will fall with a decrease in wages or one could make the argument that rents will rise due to defaulting homeowners being pushed into the rental market.

landlord · March 2008

Subject: Housing bubble and rents

Privat housing problems never effected the rents. In fact, they lead to increase in rents. This is due to the fact that many more people are looking to rent then to buy. This floods the market with people looking for rentals causing a rise in rents.

You also have to look a the vacancy rates. Currently the vacancy rate is very very low (especially in park slope) which means that there are few apartments available for rent.

Last open house I had for a prime park slope 1 bedroom apartment drew over 100 respondents (6 months ago). in the early 90's I would get around 8 respondents.

zbruno · March 2008

All i know is that i've been in my north slope apartment for 3 years. Since that time the landlord has raised the rent… 4%, 5% adn then 17%!! last year! I can't stand how this is legal – the 'under 8 units not bound by any law' bullshit. So unfair. I live in a 1-floor, 5 BR apartment with roommates (yes, 5 brs). We don't pay a lot of money but we don't pay peanuts either. If he raises the rent again I don't know where we'll go!

garfunky · March 2008

in addition to the home sales slump ,
being one of the "10 best neighborhoods" has a alot to do with the demand as well. it aint our little secret anymore.

just curious....

which neighborhood of manhattan made that list ?

willregistersoon · March 2008

I'm paying what I think is pretty excellent rent right now - $2275 for a 2bd+dining room near 7th st and the park. There's a chance we may have to move at the end of the year though so I started poking around the market a bit. I was very displeased with what I found. Is it even possible to get a 2 bed for under $3k in real Slope? I could barely find anything around for even under $4k.

lp · March 2008

– the 'under 8 units not bound by any law' bullshit. So unfair.

Could someone explain this to me? I live in a condo building with about 20 units and rent from the owner of the condo. Is there some sort of law that limits rent increases for buildings with over 8 units? Or am I just engaging in magical, wishful thinking?

caseopele · March 2008

willregistersoon wrote: I'm paying what I think is pretty excellent rent right now - $2275 for a 2bd+dining room near 7th st and the park. There's a chance we may have to move at the end of the year though so I started poking around the market a bit. I was very displeased with what I found. Is it even possible to get a 2 bed for under $3k in real Slope? I could barely find anything around for even under $4k.

Park Slope Living at Manhattan Rents!

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