Rete

In the real estate section of The New York Daily News today is an article "Foreigners Welcome" by Lisa Fresolone.

Apparently there is a company out there now that offers to act as your guarantor so that you can lease an apartment in New York City. It is difficult for those from not only out of town, but foreigners transplanted to NYC, and those who do not make 50 times the monthly rent to qualify for tenancy.

Here's the article:

http://www.nydailynews.com/real_esta...es_rentin.html

pejpm1

When I moved here and saw an apartment that I wanted, the landlord said only if I paid 6 months rent as a deposit. Not '6 months rent up front' which I would have considered...he wanted 6 months rent as security + first months rent + I had to pay the broker I used. It worked out that I would have had to spend just under 25 grand to be able to move into a small 1 bedroom apartment. Luckily we found another place that only required 2 months rent as deposit.

I understand that landlords need to protect themselves but I think the rules are a little unrealistic. I really dont see why the number is 50 x rent. I dont get why a landlord renting a place for 2k a month would need to be sure that the tenant is earning at least 100k a year. It just seems excessive.

We want to move next month so now I've been a year I'm hoping it'll be a little easier.

Rete

I am fortunate that I live less than 100 yds from the Bronx County border and in a rent stablized apartment for over 32 years. Back in that era you needed to put down 2 months security and the first month's rent. There was no credit application to be completed and no security checks either. Times have changed and I can fully understand the need for the change.

When I compare my present salary and take home pay, I can understand why a salary of $100,000 or more is required for a $2,000 a month rent.

meauxna

Have you ever checked out how long it takes to evict someone? Even if the renter is 100% in the wrong, they can live in the rental until it gets sorted. There are people who make a career out of it.

If housing costs are meant to be 25% of your take home, 100K/year income for 2K a month rent isn't that far out.

Rete

Try being a landlord in Canada. Jim rented out his condo to friends of a fellow condo owner. They stopped paying rent one September and you cannot evict tenants in the winter months in Canada. Against the law. So they lived there rent free from September until April and when they moved the place was in a shambles. They moved into government housing, both left their jobs, so suing for the back rent was meaningless.

meauxna

Yup, things exactly like that. That law isn't exclusive to Canada; I'm sure there is something like that in Oregon, and I suspect elsewhere.

pejpm1

who says that?

meauxna

lol, I knew you'd ask if I didn't put a link the first time.. It's a lending rule of thumb that I remember going back many years (like High school Personal Finance classes) and one of the 'controls' that people are cursing currently in the housing collapse. By ignoring that old rule of thumb, lenders helped people extend further than they should.

I just did a quick google and came up with many people repeating it but I'm not going to dig for a source. I see other quotes that span from 25-30%.

pejpm1

It's kind of hard to generalise though. I wouldnt be worried about going up to 40%, but no more than that. By that reasoning you'd need to be clearing 8k a month for a 2k per month 1 bed apartment. That just isnt realistic here.

meauxna

That's the problem with averages, isn't it.

Rete

When I was entering adulthood in the dark ages, it was 25% of your monthly income was what should be spent on rent. Today they say between 40 and 50%.

BTW that percentage was not necessarily after taxes.

Englishtart

I think it's a figure recommended when advising people how to plan a budget, it's not a hard and fast rule, I think it's meant to be just a guide to help newlyweds etc to not go crazy getting into mortgages/rents that will over extend their finances?

lapin_windstar

I always heard 1/3 of income in NYC - but again I don't think that's feasible for a lot of people any more.

My instincts are generally with the tenant over the landlord, and don't want to see anyone flung out on the street for no reason, but even I think the tenancy laws in NYC are excessively protectionist.

e3visa

Rentals in NY have come down because of the economy (one small blessing)...so you have some negotionating power now. However it is still very expensive and deposits are still a part of it all.

This service seems like an expensive but necessary option in NY for foreigners who have no American parents.

CJ

scrubbedexpat091

Not in NY but my rent was just about 50% of my income, and I paid lower rent then most around this area.