Checking in With the Rental Market

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    Hello all,

    long time lurker, first time poster. My tenants (whom I have a good relationship with) asked for a rent decrease on a possible renewal (this is the end of their second year).

    I’d call the apartment a small 3 or a 2+. It’s very nice for a rental and includes heat/water/DW/WD. We just put fancy new windows in as well. Apt is 2nd floor on 5th in north slope and goes for $2650.

    I was planning on a $50 increase to deal with taxes+water increases.

    I’m pretty confident that the market will bear $2700 in July but want a reality check.

    Thoughts ?

    13 Replies

    1. I do not think it is a straight comparable: original poster mentioned WD in unit and DW. It should bring more then 50 dollars extra. Especially if you compare your monthly laundromat bill for a family or number of people that fit into 2+ br apartment.
      I remember when we had a problem with tenants WD for a week and tenant with 2 kids complained that one laundromat trip cost her $25. It was more then 5 years ago. I believe that laundromat prices went up since then. Not to mention a convenience.

    2. A friend of mine is a corporate transfer from Sweden. He took time to explore NYC neighborhoods and set his mind on Windsor terrace or Park Slope. He needs 2+ bedrooms for his family.
      There is almost NO inventory. It is not like everything is above his price range. It is more like 2+ brs with WD are almost impossible to find. I did not believe him initially and tried to look by myself with negative results.
      I even briefly thought to raise MY tenants rent 🙂 and decided to do a modest raise ( 50 dollars) after new year.

      That said I believe you seriously undercharge your tenants. Unless the place is a complete dump ( which is not based on your description). Look at NYT, look at craigslist.

    3. Thanks to everyone for all the responses, it’s very helpful.

      The apartment is on 5th near Bergen. The tenants are 3 recent college grads sharing and one is moving out to be on his own. They want to stay but don’t want to get a rando from craigslist and can’t afford it with two of them.

      Last night we had a chat where they asked for a reduction of 10-15%, can’t blame them for trying 🙂 I explained about expenses. We agreed to give each other a month to explore the market.

      My plan is to put the informal word out and see if they come back with a counteroffer when check out other places.

      thanks again,

      joel

    4. I get confused when people refer to NOT losing rent money when an apt turns over. We have always lost 2 weeks because we clean and repaint before new tenants move in. Maybe it’s possible to do it one week, not two, but I do the cleaning myself and can work on it evenings and weekends. How does anyone move in a new tenant the day after the old one leaves??

    5. Considering that the rental market has improved, and that your expenses have continued to increase, a less than 2% increase is very reasonable. Sounds like they’re thinking of moving. If you give in they’ll just play the same game next year. If you really like them as tenants I would agree to no increase now but let hem know to expect small increases in the future.
      Don’t let someone here make you worry about losing a month’s rent. As long as you have at least 30 days you can rent it.

    6. we are in center slope and found we were able to INCREASE rent from 2000/month to 2300/month for a large one bedroom floor through (no DW no WD).

      of course if you like the tenants, that’s another story, but my impression is that rental market is much stronger than it was in fall 2009/winter 2010 when we last had a vacancy.

      there is no reason to imagine your rental would be vacant an entire month if these tenants move out.

      we chose to do 15 days vacancy to do upkeep but it would have been easily possible to move someone in the day after the last tenants moved out.

      we used Temple Morrow at 1214 8th avenue as brokers for our rental. you might call them for advice which is free and their services are also free of course to landlords for rentals if you decide to go that route. 347-725-3370.

    7. Agree w. DeLepp. Also fuel costs! The rental market is stronger than it has been in a few years, and your current rant sounds reasonable. Where else are they going to go for that price w. comparable amenities and location?

    8. I would explain the tax and water increases. Water has increased 15% annually over last few years and taxes have gotten crazy. Many renters may not know.

    9. If you lose one month’s rent due to vacancy over a $100/month squabble, then it will take you over two years to recoup that loss. Plus you already have a good tenant. There is now guarantee that your new tenants will be good.

    10. I think your current rate is reasonable & feel quite certain you could get more. I stay under market rate because it’s not full service & want a more relaxed tenant/LL relationship – you might feel the same way but your current rent is reasonable.