The average cost of an apartment in New York with the agent’s fee reaches 13,000. dollars

A brand new evaluation reveals the high fees New York brokers charge tenants, with costs as high as $13,000.

A recent study by apartment rental company StreetEasy found that the average upfront cost of renting an apartment in New York City, including an agent’s commission, has skyrocketed to almost $13,000. This huge sum covers agent’s remuneration, first month’s rent and deposit, reports.

In 2023, the average upfront cost for broker-fee apartments was $12,667, up from $9,984 in 2019. The increase comes at a key time as New York City prepares for Wednesday’s City Council vote. The City Council will consider a bill geared toward relieving tenants of costly brokerage fees. The bill, generally known as the Fairness in Rental Housing Act (FARE), appears to have strong, almost veto-proof support.

For the study, StreetEasy surveyed over 500 renters and located that over 80% of respondents believed that landlords should cover agent fees. Additionally, 76% said they felt forced to pay a broker’s commission to secure a house in New York’s highly competitive rental market.

“The average New Yorker will spend more than 10 percent of their annual income just to cover these upfront costs,” said Kenny Lee, senior economist at StreetEasy.

Tenants are objecting to the high fees they’d to pay brokers to rent an apartment in New York.

“It doesn’t seem like this happens anywhere else,” said Kayla, 31, of Williamsburg, Brooklyn. She estimates she paid $4,000 in broker fees for her apartment seven years ago. “Because I did all the work for this (apartment), I feel like I wasted my money.”

Jemma Rowlands from Melbourne, Australia, thinks the realtor’s fee she paid for her first New York apartment in 2018 seemed “expensive and unnecessary.” Giving up upfront costs “seems good to me,” he says of the proposed bill.

Supporters of the Local Government Act argue that it’ll reduce the financial burden on tenants. But critics say landlords will offset the broker’s fee by increasing rental prices for annual leases.

“The FARE Act will fundamentally disrupt the New York real estate market, raise rents, and make it even more difficult to find housing, and nothing StreetEasy has proposed will solve any of these problems,” said York.

Supporters of this solution argue that the law will profit each tenants and intermediaries, the latter of whom often rent property with none guaranteed payment.

“When the bill comes into force, both landlords and agents will have the opportunity to negotiate how compensation is paid, and tenants will finally have a choice as to whether they want to work with a broker,” Lee said.