Renting Out Your NYC Apartment: Should You Go FRBO?

If you are following the news recently, apartment deals are flying off the shelves as more renters flow into the NYC real estate market.?

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According to?Slate.com, the alluring advantages of remote work coupled with increasing demands for pieds-à-terre are creating an environment where rents have reached staggering numbers.??

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In this situation, owners are taking this as an opportunity to rent out their units. And since there is a high demand among renters who won't hesitate to pay more for living space, many are bypassing the need to hire a broker.

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Instead, they are going through what is known as the For Rent By Owner or FRBO process.?

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What is the FRBO process??

Traditionally, you need a real estate professional to help you navigate the process of selling your home. However, there are certain situations where you handle the process yourself. In that case, your home is put under FSBO (For Sale By Owner) status where you list the property, do the marketing, and handle the paperwork by yourself.

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FRBO also works the same way, the only difference is that you (as the owner) do everything a broker would do to find potential renters and score a lease deal. This includes:

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Staging your property. The unit should stand out from the rest in the local rental market. Staging goes beyond aesthetic improvements such as a new paint job and fixtures. You will also need to create a healthy indoor environment. Doing so attracts renters that prioritize a sanitary and comfortable home office.?

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Screening renters. Before you accept a renter, you must make sure that they won't give you any problems once they move in. Through FRBO, you will be the one to interview renters and run background checks. It can get tedious, but it's worth your time if it means accepting renters who can pay on time and won't cause any issues.?

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Promoting the unit. Apart from listing the unit on Zillow and Refine, you should also post ads and marketing content on social media. Building awareness is the key if you want to find the best tenants, so you will need to invest in an effective social media campaign.?

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Negotiating lease terms. In place of a broker, you will be the one to draft out a lease agreement. But before finalizing the lease, you may need to deal with a back-and-forth discussion with a renter. While you need to keep your interests in mind, you should also take care not to overstep any local ordinances that protect renters. For this reason, you should always refer to the city’s Tenant Protection Laws.?

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What are the Pros and Cons of FRBO?

The biggest advantage of going FRBO is the amount of control you have throughout the process. You get to have the final say over the rent price and the terms of the agreement.

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But this comes at a cost. Considering the complexity of leasing out an NYC home in today’s rental market, you could end up stretching yourself too thin as you juggle between promoting the unit and preparing an on-site tour.?

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And that’s not all. There is also a ton of technical work you will need to do so the transaction flows smoothly. Even if it does, you still need to prepare for any scenario that could cause the transaction to fail.?

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Unless already know the technicalities for leasing out your living space, you might as well lean on the expertise and professionalism of a leasing broker.?

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If you are planning to make your apartment available for rent, feel free to call me at?917-627-5677??or send an email to?[email protected].?

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I have worked with NYC residents for a long time to know what it takes to find renters. Your peace of mind is good as guaranteed.?

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Talk soon,

Eli