Broker fees for rentals

I’m a landlord looking to rent three apartments in one building using a broker. I want to do an exclusive with a broker and the one I have talked to has sent a draft contract which states that the renter will pay a broker’s fee of 15% of the first year’s rent. This seems excessive to me, whatever happened to one month’s rent being paid by the tenant? Also, how long should the exclusive contract with the broker be for, one month? Thanks for your help.

nhamilto

in Real Estate - Rentals 12 years and 8 months ago

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Snezan | 12 years and 8 months ago

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i like to have the flexibility of offering a lower broker fee rate in order to draw more clients.  So far my landlords haven’t had an issue of getting high rents alongside with tenants paying the broker fee.  Since you are offering it to the broker as an exclusive, he does have the ability to send it out to other agents for a cobroke and then that 15% will be split between two agencies and come out to 7.5% each. That might explain the large number. You might want to ask him if he is willing to discount for a direct applicant coming without a broker. Usually having a large pool of agents bringing clients will get you the fastest and most qualified renter.   30 or 60 days is the standard rental contract. I would get concerned after a couple of weeks.  So far only one of my listings has taken longer than a few weeks to rent. Pricing properly, marketing well and being available usually bring a great client within the first week.  Well, that and persistence.

Bklnite | 12 years and 8 months ago

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I use CL to rent apartments. 15% is a lot for the renter — with 1st month, security & fee they’re looking at nearly 4 months rent up front. If don’t use a broker you open up a larger pool of potential tenants, and you might find people willing to pay a bit more per month for a no-fee apartment vs. one with the broker fee.

BigGuy22 | 12 years and 8 months ago

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Depends on what neighborhood you’re in…Downtown BK is 15% some are 12%…other side of Brooklyn is still one months rent…Manhattan Brokers in downtown BK charge 15%…It can be negotiated normally….