New York City Broker Fees Explained

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7 Responses

  1. POPS says:

    Great article. Really like the no-fee map. Keep up the great work.

  2. Wow, Max, you know this is a hot spot for change, and I’m sure your software can help these renters in their decision a lot. I guess it’s easy on the person renting the unit, but there’s no way somebody won’t step in the create a tech method for fixing this dea.

    • Max Galka says:

      Agree. Our no fee map is a one-off project we thought people would find helpful, but it is far from a permanent solution. I think disruption is on the way for real estate, and look forward to seeing how it plays out.

  3. Matt says:

    Thanks for the article! Question on the landlord side.. In NYC, where tenants typically pay the brokers fee, does a landlord who found his own tenant have any obligation to pay a broker that had an informal arrangement to find a tenant for the landlord?

  4. Max Galka says:

    Good question. The landlord has two options.

    He can do an exclusive listing, in which he agrees to let one broker list the apartment. If the apartment gets rented, the broker collects a fee — doesn’t matter how the tenant found the apartment.

    The landlord can also do an open listing. In this case, the listing is open to any broker. And if the landlord finds the tenant himself, he does not have to pay anyone.

    Exclusive is more common (about 70% of listings)

  5. Jordan Vidor says:

    Great piece – thanks.

    Like many other industries in 2015, the rental-broker industry is dying and candidly needs to die faster… would be helpful to see regulators step in and expedite its death. Insurance brokers are capped at X% of premium (figure depends on market and line of business) – yet – we continue to drastically overpay for a service that is (in most cases) largely unnecessary.

    The tack on of the “broker fee” (which… by the way… is a $5-$10K fee we pay to just-out-of-college ‘salesmen’ and bored housewives) has inflated rental costs to a point that has made affordable rentals few and far between.

    We have had a healthcare overhaul. This next election will focus on an education/pension overhaul. Where is the real estate overhaul??? Specifically the rental market?!

    If I was governor – I would have these guys paid nothing. Posting a few pictures to a website a couple of times a month is a task interns and college students should take up.

    This industry needs to go and not sure why it’s not getting more limelight.

  6. judy says:

    There are wonderful real estate brokers who are true professionals …. and then they are others. And there’s a big difference. If people want to sit and do the due diligence of finding apartments to look at … that’s great. And then there are those who just don’t have the time. We all have choices in life. The choice is yours … to work with a TRUE PROFESSIONAL broker …or not.
    I, myself, am a broker … and I’m often told how easy I’ve made the process …. verses theier past experiences. So, again … it’s always your choice.

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