Who would ever have expected this?
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no one to see here, move along, move along
Require landlords, not renters, to pay a broker’s fee, and surely those landlords will simply eat the cost rather than pass them on to tenants, right? Right? No one on the City Council ever worked a real job or studied even basic economics, so results like these continue to astonish them.
End of broker fees drives up rent in NYC overnight. Will renters leave the city?
Keeping as close an eye as anyone on New York City's luxury rental market, Douglas Elliman broker Keyan Sanai is convinced that landlords will be hiking rents by hundreds of dollars a month as a result of a new law on broker fees.
Will that prompt a new stampede to suburban markets like Connecticut? No chance, Sanai says, noting sky-high occupancies in New York City today, five years after the COVID-19 pandemic drained apartment buildings in what turned out to be a short-lived outbound migration.
Under the new Fairness in Apartment Rentals Expenses Act that took effect in New York City on Wednesday, landlords must cover fees that tenants had previously been paying brokers for available rental listings. Landlords that fail to do so can be forced to pay restitution by state regulators, and can be sued for noncompliance.
Sanai, a Manhattan-based broker for Douglas Elliman, says many listings on Zillow's StreetEasy website and others suddenly became more expensive overnight as the new rules took effect — in the midst of the prime lease season that runs through September.
"The data's there — 1,000 listings fell off StreetEasy within 24 hours," Sanai said. "Every single landlord is baking it in, in some capacity. The question is, what percentage are they baking in?"
While renters will save moving costs up front by not having to pay a broker fee, Sanai believes that they will pay more over time as rents reset to higher rates, particularly those who stay more than a few years in the same apartment. Still, he believes the vast majority of New York City renters will just pay more rather than contemplate a move out of the city, noting occupancies have stayed high despite overall rent inflation and other costs of living in the past few years.
Manhattan had the sixth hottest rental market in the country heading into the spring and summer apartment hunting season, according to Rent Cafe analyzing data from Yardi Metrix. The Stamford-Bridgeport corridor was tied with Brooklyn for eighth place on the study.
"There's a couple of things you can bet on with absolute certainty," Sanai said. "You can bet on the fact that New York City will always come back."
Sanini will be proved wrong about the city’s prospects if the voters put a socialist/communist in office, as seems likely; at least, that’s what “the Experts” say, and when have they ever been wrong? Still, stopped clock and all that, and their prediction seems at least plausible, because how much punishment is the middle class willing to endure?