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I am very unfamiliar with the whole New York real estate concepts. I have two questions: what does it mean when you are looking for a "no fee" apartment? What is this "fee" that you are normally charged?
Also, when buying apartments what does it mean to buy a place within a "co-op"? Is this a good thing?
I don't know the answer to your first question. However, I can respond to your co-op question. A cooperative is a corporation, in which shares are distrbuted to shareholders (people who live in the building by virtue of having paid money to buy those shares). Owning shares entitles you to a proprietary lease on an apartment. The number of shares varies, depending on the apartment (better apartments go with higher share ownership).
Thus, when you see an ad for a co-op apartment, it's not really the apartment you're buying - it's shares in a building that will give you a proprietary lease on THAT apartment. The co-op board reviews your financials, interviews you and decides whether you can buy the apartment (the shares, really). The building board also determines how much of a sale should be in cash. There are buildings that require 100% cash and some that require as little as 20%, the rest being in the mortgage. And, yes, the 100% cash buildings do not allow mortgages. They also restrict subletting the apartments, for which I'm eternally grateful.
In a condominium you own the actual apartment, there's no board interview and no review of financials. Which is why some condominiums are having trouble now: the owners have defaulted on their jumbo mortgages. You can sublet without any notification to the condo board. Which is one reason I don't like a condo: you can end up with nutty neighbors and have NO recourse, because it's perfectly legal to sublet to anyone. A friend is going through condo hell like that right now because of a sublet apartment above him.
I am very unfamiliar with the whole New York real estate concepts. I have two questions: what does it mean when you are looking for a "no fee" apartment? What is this "fee" that you are normally charged?
Also, when buying apartments what does it mean to buy a place within a "co-op"? Is this a good thing?
when you find an apt through a real estate agent they charge a fee for their services, some apts. the landlord will pay that fee or you can rent an apt. directly from the landlord again, no fee.
The fee charged by real estate agents is quite high, usually around 15% of the annual rent. Depending on the area, it can be quite difficult to find a "no-fee" apartment.
See this article for the main differences between coops and condos. You (and your attorney) will need to do a lot of research about any building you are considering, whether a coop or a condo.
Kelliott,
I read your post on New York real estate.
My name is Rich. I'm a real estate broker in NY & NJ and mainly work up the Hudson River across the Tappan Zee Bridge in Rockland & Bergen counties.
When a real estate ad say's " No Fee", it usually is related to the apartment being offered unrepresented by real estate brokers. Basically, it's for sale or rent by the principle owner. Fees charged can vary for rentals, but usually amount to one month's rent, plus any other associated and related fees for credit reports that can be requested.
Generally speaking, when ads say " Co-Op", it refers to the form of ownership in the property being offered for sale or rent. Co-Ops differ from real property ownership as in a condominium, for example.
I'll be glad to assist anytime with further information. Please let me know.
Best Wishes,
Rich
Kelliott, this may apply across the river, but this is not what No Fee means in NYC.
In NYC, there are a handful of sources for apartments: owners, management companies, listing services, and brokers.
The listing services are almost all a sham, so don't even look at those listings on Craig's.
Occasionally, Mom and Pop landlords will rent apartments themselves or larger landlords will have their super show the place. They will probably charge for a credit check but there will be no other fees. (Unless they ask for "key money" which is basically a bribe and completely illegal.)
Management companies manage multiple buildings for owners and may also have agents who will rent out apartments, they often do not charge a fee.
Now we come to brokers. Some owners don't want to deal with holding open houses or screening potential renters so they hire brokers/real estate agents to do this work for them. The owners do not pay for these services, the renter does. In Manhattan, the fee is often 10-15% of a year's rent. I've heard that the fees are lower in the other boroughs, but I have never dealt with that.
So if you see an apartment listed as No Fee, it usually means that an owner or management company is filling the vacancy. Occasionally in slower markets the owner will pay a broker's fee to fill the vacancy rather than have the apartment sit unoccupied.
I'll chime in, because it looks as though you have a mixed bag of replies, not all of which are accurate.
The fee referred to is usually mainly the broker's fee, which these days is 15% of the year's rent. Most middle-class people find that outrageous, so prefer looking for no-fee apartments, which either means there is literally no fee or else the landlord has chosen to pay the fee. There can, however, be other fees, so you should always ask - there can be an application fee, a credit-check fee, etc.
Ads in places like the NYT will say "no fee," but the biggest source for no-fee apartments is Craig's List. They are not mostly scams, but it's true that there are occasionally scams, so be alert. Most ordinary people seem to find their apartments via CL, and it also has a Housing forum where you can ask questions.
If you are still at the stage of asking what a co-op is, you should should not even think about buying one. It's a complicated, involved area, and no one should consider it without knowing the territory.
However, you may have been confused about the possibility of renting within a co-op. A co-op owner may choose to sublet his apartment, which would likely be about the equivalent of a no-fee rental. These can work out wonderfully well, but be aware that these do not offer you any of the legal protections of, for instance, a rent-stabilized apartment of your own.
True,
In Manhattan most things are valued more, including rental fees.
Best Wishes,
Rich
Quote:
Originally Posted by UpsonDowns
Kelliott, this may apply across the river, but this is not what No Fee means in NYC.
In NYC, there are a handful of sources for apartments: owners, management companies, listing services, and brokers.
The listing services are almost all a sham, so don't even look at those listings on Craig's.
Occasionally, Mom and Pop landlords will rent apartments themselves or larger landlords will have their super show the place. They will probably charge for a credit check but there will be no other fees. (Unless they ask for "key money" which is basically a bribe and completely illegal.)
Management companies manage multiple buildings for owners and may also have agents who will rent out apartments, they often do not charge a fee.
Now we come to brokers. Some owners don't want to deal with holding open houses or screening potential renters so they hire brokers/real estate agents to do this work for them. The owners do not pay for these services, the renter does. In Manhattan, the fee is often 10-15% of a year's rent. I've heard that the fees are lower in the other boroughs, but I have never dealt with that.
So if you see an apartment listed as No Fee, it usually means that an owner or management company is filling the vacancy. Occasionally in slower markets the owner will pay a broker's fee to fill the vacancy rather than have the apartment sit unoccupied.
Good luck with your search!
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