On top of shelling out for rent and security deposits in New York City’s highly expensive rental market, many prospective tenants looking for an apartment must deal with another major cost: a broker fee. That hefty fee, a one-time payment that is typically between 10 to 15 percent of the annual lease amount, is paid by the renter to the broker on the listing regardless of whether the broker helped the tenant find the unit and sign the lease. For a $2,500 per month apartment, for instance, the fee could be as high as $4,500. Before renters receive keys to a new apartment, they will likely have to pay that fee on top of the first month’s rent and a security deposit, which is usually equal to one month’s rent. This week, New York State made clear in new guidance to the real estate industry that broker fees were legal, ensuring that in the digital era of virtual tours, a vestige of pre-internet listings would endure.

Source: New York Times May 27, 2021 15:11 UTC