The Apartment Blogger

Apartment Renting in Boston, Massachusetts and Beyond

No Fee Brokers, are they really working for free?

I felt it was important to explain the broker fee system in Boston to all the new renters out there; especially the “No Fee Brokers”.

If any of you ever wondered what makes this group of extremely wonderful and generous people donate their time and expertise for free then here is your answer.

A broker or real estate agent gets paid the equivalent of 1 month’s rent in virtually every transaction in which an apartment is rented.

There are 3 ways that they get paid:

  1. You, the renter, pay them a full month’s rent fee.
  2. You split the month’s rent fee with the landlord so each party pays a half-month’s rent.
  3. The landlord pays the full month’s rent fee.

Scenario 3 is better known as the “No Broker Fee” apartment.

From my experience, if the landlord is willing to pay such a high incentive, the fee ends up being passed down to you anyway in the form of higher monthly rent. For example, a $1200 a month apartment with a one month’s fee would end up being $1300 a month ($1200/12=$100 extra dollars per month) so the landlord recovers his expense. Your rent is higher than it could have been if you rented the unit directly through the owner/property manager.

Also another point worth driving home – no matter who pays the broker fee, the more rent you pay, the more fee they get. That relationship usually leads to you seeing apartments that are at the top if not slightly over your price range.

Bottom line is this: if you want to avoid paying a broker fee you should not go around with brokers. It doesn’t matter whether they classify them self as Fee or No Fee; there is no free lunch.

IG

Filed under: Apartment Renting, Tips and Tricks by IG on 03.29.2008
No Comments »

Open Season: September Apartment Rentals

I wanted to officially note that the September 1, 2008 rental season is already in full-swing; and it seems we are going towards an extremely busy and competitive rental market this Spring and Summer. Not only have we (GrandCentralApartments.com) already been getting availability updates from a good portion of our management companies, we have seen a substantial amount of clients finalize their leases for September, 2008.

So for all you April-September renters, I would suggest you start your search early. As soon as the weather gets warmer and more people are out looking, prices will rise and inventory will go down.

The early birds get the worm.

On another note, Boston Real Estate Now, The Boston Globe Blog covered a new rent calculator-thingy called Zilpy.com. I’m not entirely sure how they get their information, but you can get some detailed info about Boston, MA (or any location you desire), such as:

  • Renter occupied: 64 %
  • Population: 589,141
  • Vacancy rate: 4.9 %
  • Median household income: $39,629
  • Monthly rent affordability: $990
  • Crime rate index: Violent: 5; Property: 4 (1-lowest, 5-highest)
  • Ethnicity: White (54 %); Black (25 %); Hispanic (14 %)
  • Age groups: 25 to 34 (21 %); Under 18 (20 %); 18 to 24 (16 %)
  • Education: High School (38 %); College (13 %); Graduate School (10 %)
    Source: zilpy.com

Good luck,
IG

Filed under: Apartment Renting, Tips and Tricks by IG on 02.20.2008
No Comments »

Are you paying too much for rent?

How does your rent compare? I just recently discovered rentOmeter, a website that asks you to plug in your zip code, how many bedrooms you rent and for what price. After some number crunching rentOmeter gives you a ballpark idea what your neighbors are paying and thus, how you compare.

Since anybody can plug in whatever they want the results are not necessarily accurate but I thought it was an interesting concept nonetheless.

Enjoy

IG

Filed under: Apartment Renting, Tips and Tricks by IG on 01.03.2008
1 Comment »

next post |