4 ms·

> Is hunting for an apartment doomed to be this messy forever? It seems like an area that is ripe for disruption or a better option, but what would it take to a

by timr 5y ago

> Is hunting for an apartment doomed to be this messy forever? It seems like an area that is ripe for disruption or a better option, but what would it take to actually solve this? I hesitate to say it, but there is already a solution to this, and it has been the one that New York has had for years: you hire an agent. A good agent will sort through all of that for you, and streamline the process to the point where you can go from search to signing in under a week (if not quicker). Of course, there's the problem of bad agents, but that's true of anything. As you note, online services are often bad, as well. In other words, I don't see this as a problem without a solution; I see it as a problem without a software automated solution, which is true for a lot of problems in life, particularly ones that involve huge numbers of messy, opinionated people with different motivations and interests.

edmcnulty101 5y ago
What kind of agent? Just a. real estate agent?
- klodolph 5y ago
  An apartment broker. Just like when buying a house, an apartment broker works on behalf of the landlord or the tenant. They charge a fee which is a percentage of a year’s rent. It is negotiable.
- timr 5y ago
  Essentially. In NYC, many real estate agents will represent the renter for a service fee, just like they represent the buyer in a purchase transaction. It supplements the income that comes from the higher-value (but much less regular) money that they get from sales. There are agencies that make most of their business in this area, and generally have better rate structures (typically a month or two of rent, flat rate). Others want to charge you on a percentage basis, which you can negotiate, and obviously changes the incentive structure. All of these are "expensive" (relative to free), but worth it depending on how you value your time. Other people are (rightly) noting that there is risk of getting a scammy real estate agent, but that's true of any service. You have to look at reviews and trust your gut. Good real estate agents are motivated to do the right thing for you, because they see it as a marketing channel into larger sales in the future. Bad real estate agents are in it only for the immediate cash. These people behave in such obviously different ways that they're pretty easy to discriminate, in practice.
  - throwawayboise 5y ago
    If the agent is in any way getting compensated when you sign a lease, or as a percentage of the rent, or anything like that, they are not working for you. The only way they might be working for you is if you are paying them an hourly rate or per showing or something like that.
    - timr 5y ago
      If you're saying that the historical "broker's fee" when renting in a place like NYC doesn't benefit you, then I agree. That broker represents the landlord, not you, and you're just being charged to make up the cost. If you're saying that someone doesn't "work for you" unless you pay them a flat or hourly rate, then I disagree completely. All incentive structures have problems. Someone who works on contingency is incentivized to get you to sign. If they take a percentage cut, of course, they want you to sign the most expensive thing they can. Someone who works on a flat-rate basis is incentivized to do as little custom work as possible. Someone who works on an hourly basis is incentivized to drag out the proceedings. There is no perfect system. Most of these agreements are structured where the fee is paid by you, after signing a lease, as a function of the monthly/annual rental price. The agent works for you, you just don't pay up front or a fixed cost or on an hourly basis. Does this change the incentive structure? Yes. Does it mean that they don't provide you a benefit? No. You just have to be aware of the incentives.
kortilla 5y ago
That solution is bad. You have no idea what you’re missing out on by using an agent. You might think you had a good agent, but unless you’re already really familiar with the market, you could have missed out on significantly better matches and you wouldn’t even know. You know how we know this is a solvable problem? Listings for places to buy don’t have nearly as many problems.
- timr 5y ago
  Like I said, there are bad agents. There are also bad plumbers. There are bad doctors. There are bad housekeepers. This is not a problem unique to real estate, and tools exist to help you find reliable service professionals. > You know how we know this is a solvable problem? Listings for places to buy don’t have nearly as many problems. Just as OP said, there are tons of sites out there that claim to "solve" this, but don't. So no, I don't know that this is a computer-solvable problem.
unsupp0rted 5y ago
In other countries, not in the USA, I've never once had a good experience with renting via an agent. It seems it's in their job description to try to convince me to pay more for less. They listen carefully to my requirements and then take me to places that don't match at all. I guess they figure since I've taken my entire afternoon with them, and since they've been friendly, I might give up on what I'm looking for and rent whatever it is they decided to shill that day. Of all the countries I've rented in and had occasion to interact with agents, ones in Turkey behaved the most like cartoon caricatures: they use every sitcom used car salesman trick in the book. It would be funny to watch, except that they're perpetually wasting their time and mine.
8f2ab37a-ed6c 5y ago
This doesn't work in all US markets unfortunately, as I discovered recently when considering that very option you suggest. In some slower towns a few agents are willing to do this on the side as a source of income, but then in places like SF the home buying market is so hot, that it's comparatively bad ROI for agents to spend any time on most rentals. I'm curious how NYC manages to pull that off.
- bobthepanda 5y ago
  NYC has a broker’s fee to pay for rentals. The typical rate is somewhere between a month’s rent and 15% of annual rent. It’s quite expensive.
  - timr 5y ago
    This isn't strictly true. Historically many do, but increasingly many don't. It's been changing. Whether you pay for your own representation is also an entirely separate question. As someone else in this thread noted, the landlord often hires an agent because they don't want to deal with the tidal wave of crap that comes from dealing with applicants. That person gets paid, obviously, and the landlord isn't the one paying them. That's the rate you're talking about here. These people are not incentivized to provide good service to the renter, and typically don't. They suck. Higher-end buildings often have in-house agents (again: you're paying for this, whether you realize it or not), and these are called "no fee" buildings. But an increasing number of places don't have either, and just provide access to professional renter's agents instead of listing publicly. Or they do list publicly, and barely respond to the tidal wave of yahoos, knowing that motivated renters hire an agent. YMMV.
- timr 5y ago
  A lot of NYC agents also do this to supplement income. Real estate is feast-or-famine, and especially during the slower sales markets you can find that agents are highly incentivized to do a good job. But yeah, you're going to take a back-seat to the purchase transaction in a hot market, unless you make it worth their while on a dollar-per-hour basis. That's the downside of using a "regular" real estate agent. In NYC specifically, there are agencies that make most of their business from renter-side representation. You can find the good ones easily on the usual review sites.

by timr 5y ago

edmcnulty101 5y ago

What kind of agent? Just a. real estate agent?

klodolph 5y ago
An apartment broker. Just like when buying a house, an apartment broker works on behalf of the landlord or the tenant. They charge a fee which is a percentage of a year’s rent. It is negotiable.
timr 5y ago
Essentially. In NYC, many real estate agents will represent the renter for a service fee, just like they represent the buyer in a purchase transaction. It supplements the income that comes from the higher-value (but much less regular) money that they get from sales. There are agencies that make most of their business in this area, and generally have better rate structures (typically a month or two of rent, flat rate). Others want to charge you on a percentage basis, which you can negotiate, and obviously changes the incentive structure. All of these are "expensive" (relative to free), but worth it depending on how you value your time. Other people are (rightly) noting that there is risk of getting a scammy real estate agent, but that's true of any service. You have to look at reviews and trust your gut. Good real estate agents are motivated to do the right thing for you, because they see it as a marketing channel into larger sales in the future. Bad real estate agents are in it only for the immediate cash. These people behave in such obviously different ways that they're pretty easy to discriminate, in practice.
- throwawayboise 5y ago
  If the agent is in any way getting compensated when you sign a lease, or as a percentage of the rent, or anything like that, they are not working for you. The only way they might be working for you is if you are paying them an hourly rate or per showing or something like that.
  - timr 5y ago
    If you're saying that the historical "broker's fee" when renting in a place like NYC doesn't benefit you, then I agree. That broker represents the landlord, not you, and you're just being charged to make up the cost. If you're saying that someone doesn't "work for you" unless you pay them a flat or hourly rate, then I disagree completely. All incentive structures have problems. Someone who works on contingency is incentivized to get you to sign. If they take a percentage cut, of course, they want you to sign the most expensive thing they can. Someone who works on a flat-rate basis is incentivized to do as little custom work as possible. Someone who works on an hourly basis is incentivized to drag out the proceedings. There is no perfect system. Most of these agreements are structured where the fee is paid by you, after signing a lease, as a function of the monthly/annual rental price. The agent works for you, you just don't pay up front or a fixed cost or on an hourly basis. Does this change the incentive structure? Yes. Does it mean that they don't provide you a benefit? No. You just have to be aware of the incentives.

kortilla 5y ago

That solution is bad. You have no idea what you’re missing out on by using an agent. You might think you had a good agent, but unless you’re already really familiar with the market, you could have missed out on significantly better matches and you wouldn’t even know. You know how we know this is a solvable problem? Listings for places to buy don’t have nearly as many problems.

timr 5y ago
Like I said, there are bad agents. There are also bad plumbers. There are bad doctors. There are bad housekeepers. This is not a problem unique to real estate, and tools exist to help you find reliable service professionals. > You know how we know this is a solvable problem? Listings for places to buy don’t have nearly as many problems. Just as OP said, there are tons of sites out there that claim to "solve" this, but don't. So no, I don't know that this is a computer-solvable problem.

unsupp0rted 5y ago

In other countries, not in the USA, I've never once had a good experience with renting via an agent. It seems it's in their job description to try to convince me to pay more for less. They listen carefully to my requirements and then take me to places that don't match at all. I guess they figure since I've taken my entire afternoon with them, and since they've been friendly, I might give up on what I'm looking for and rent whatever it is they decided to shill that day. Of all the countries I've rented in and had occasion to interact with agents, ones in Turkey behaved the most like cartoon caricatures: they use every sitcom used car salesman trick in the book. It would be funny to watch, except that they're perpetually wasting their time and mine.

8f2ab37a-ed6c 5y ago

This doesn't work in all US markets unfortunately, as I discovered recently when considering that very option you suggest. In some slower towns a few agents are willing to do this on the side as a source of income, but then in places like SF the home buying market is so hot, that it's comparatively bad ROI for agents to spend any time on most rentals. I'm curious how NYC manages to pull that off.

bobthepanda 5y ago
NYC has a broker’s fee to pay for rentals. The typical rate is somewhere between a month’s rent and 15% of annual rent. It’s quite expensive.
- timr 5y ago
  This isn't strictly true. Historically many do, but increasingly many don't. It's been changing. Whether you pay for your own representation is also an entirely separate question. As someone else in this thread noted, the landlord often hires an agent because they don't want to deal with the tidal wave of crap that comes from dealing with applicants. That person gets paid, obviously, and the landlord isn't the one paying them. That's the rate you're talking about here. These people are not incentivized to provide good service to the renter, and typically don't. They suck. Higher-end buildings often have in-house agents (again: you're paying for this, whether you realize it or not), and these are called "no fee" buildings. But an increasing number of places don't have either, and just provide access to professional renter's agents instead of listing publicly. Or they do list publicly, and barely respond to the tidal wave of yahoos, knowing that motivated renters hire an agent. YMMV.
timr 5y ago
A lot of NYC agents also do this to supplement income. Real estate is feast-or-famine, and especially during the slower sales markets you can find that agents are highly incentivized to do a good job. But yeah, you're going to take a back-seat to the purchase transaction in a hot market, unless you make it worth their while on a dollar-per-hour basis. That's the downside of using a "regular" real estate agent. In NYC specifically, there are agencies that make most of their business from renter-side representation. You can find the good ones easily on the usual review sites.