UNFOLD a map of Manhattan and right away you know the property market here is going to be like no other. First of all, there’s the geography — 1.5 million people on a sliver of land 23 miles square, which makes for a population density three times higher than London. Then there’s the suburb names; Hell’s Kitchen, the Meatpacking District, NoLita (as well as the impossibly cute-sounding Dumbo in Brooklyn).
The next clue is “The Hunt”, a New York Times column that each week follows a different punter navigating the bitter world of apartment rentals. With more jargon than a standard legal document, the column is a treatise on the vicious competition that comes from a vacancy rate of less than 1 per cent. Finding an apartment to rent here is not going to be easy.
Still, the migratory path of London to New York is well trodden, with thousands of Brits taking on Manhattan’s property market every year without the benefit of local knowledge, a credit history or any clue as to what a “rentstabilised coop” might be. Although the weak dollar makes buying an option, the majority of new arrivals will rent to start with.
David Elwell, from Blackheath, in southeast London, transferred to New York in May. The work transfer is a common way in, but even with an employer who is willing to provide letters of recommendation finding an apartment is “an absolutely monumental effort”, says Elwell. With less than a week to look before starting work, Elwell enlisted a real estate broker from the city’s largest agency, Corcoran. “I looked at a few places on my own, but I soon realised it was going to be extremely difficult because I didn’t know the neighbourhoods,” Elwell says.
Elwell looked at 30 apartments around Times Square that were within his $3,500 monthly budget. He says: “I saw a lot of ‘one-bedroom flats’ that were actually L-shaped studios. Another was so small that the shower was in the kitchen. Some had no kitchen, just a hotplate in a cupboard.”
Advertisement
Other apartments attracted 150 people to a one-hour viewing and, having yet to establish a US credit history, Elwell’s application quickly fell to the bottom of the pile. Just as he was attempting to remortgage his London property so he could lay out six months’ rent in advance, Elwell found a landlord who was willing to take his job with a big firm as security and he moved into a one-bedroom flat in Hell’s Kitchen, also called Clinton, within walking distance of work and with an excellent bar and restaurant scene.
There was also a lesson in fees — up to $500 a throw in non-refundable application fees, between $20 and $100 for a credit check, and the real surprise to most Brits, the broker’s fee. The standard rate is 10-15 per cent on the annual rent, which in Elwell’s case worked out at $7,000.
“The broker’s fee is the biggest shock to most Brits,” says Lucie Holt, a broker with the agency CitiHabitats, who moved from London to New York nine years ago. Around 20 per cent of her clients are from the UK and most go through the same learning curve. Holt says: “Bring as much documentation as you can — letters from previous landlords, mortgage statements, bank statements, everything. Often clients turn up and they’ve put all that in storage and they have nothing but a passport. That’s when you’ll have to put a year’s rent up to get anything.”
It also helps to know that there are three different types of rental building in New York, each with their own application process. The first, explains Corcoran agent Emma Hamilton, is a straight-up rental building, which is the easiest to get into as they are 100 per cent tenanted and owned by management companies. But Hamilton says: “Brits usually don’t like them because they are too dormitory-like and don’t have the character they look for.”
The second type is the condo, a building occupied by a mix of tenants and owners. Owners of condo apartments set their own requirements for application. Almost all new buildings fall into this category.
Advertisement
The third type, the coop, is the hardest to get into but often the most desirable. These buildings are run by draconian co-operatives, in which apartment owners have shares. “Most of the really characterful, prewar buildings in areas Brits like, like the Village and SoHo, will be coop,” Hamilton explains. “To get into a coop building, you’ll have to disclose everything from your financial situation to your schooling.
The coop board can specify no smoking, no pets, no students, and turn down your application without saying why. Being approved for a coop can take months, but once you’re in you know you’ll have good neighbours.”