Should I Rent or Sublet?

When renting an apartment in New York City, you have two options. The most conventional is to go directly through a rental building, as this is often a relatively straightforward process. On the other hand, many apartment-hunters take an alternative route by renting a condo from the owners themselves. Each option comes with its own perks and drawbacks. While the application process for a rental building is almost always quicker and significantly less expensive, condos often feature nicer finishes and more amenities. Many renters also prefer being able to deal with one owner rather than the leasing office or management when problems arise, although a difficult or indifferent owner can make you wish for the bureaucracy of a leasing office. We’ve outlined the major differences below to help you decide on your best course of action.

Legal Differences

As always, policies differ greatly from building to building, but most boards place limits on rentals. In addition to having the authority to deny an application outright, they can also insist on provisions governing sublets. Some buildings forbid short-term sublets, and others place limits on the duration of long-term sublet rentals. Condos, on the other hand, are typically more relaxed. The upside is that in a condo or co-op you have more ability to negotiate contract terms. Although certain requirements put forth by the board are set in stone, there are certain provisions that can be negotiated between the renter and the owner directly. Rental buildings are usually more stubborn as they prefer to keep the lease terms standard. Still, reviewing the contract alongside a broker may help you find some room to maneuver.

The Approval Process

The process for renting depends on the building, but you can expect a lengthy procedure with plenty of paperwork. It’s recommended to consult a broker before you even begin the application process to make sure you aren’t wasting your time. When renting a condo, the board only has a “Right of First Refusal.” In other words, the board can either approve the rental or match the offer and rent the apartment from the owner themselves. Renting directly through the building generally only requires a barebones application and credit check.

Another thing to keep in mind is that the approval process for a condo or co-op can take significantly longer than a rental building. In addition to the time it takes to prepare the necessary materials, your application will have to be approved by the owner, the managing agent, and finally, the board itself. This will typically take 10-30 days with a condo, and up to 45 days for a co-op. When dealing with rental buildings, approval falls to a single landlord, so the process doesn’t usually take longer than a week.

Costs

New sublet applications must be submitted to the management company for every new tenant. The cost for the various deposits and fees typically range between $500 and $2500, although whether the landlord or tenant will pay these fees is a part of the negotiation process. If guests are staying shorter periods of time, hotel taxes will apply. As always, details will vary based on the building and board, which means that brokers will be especially helpful in preparing and presenting a board package, as some of these can run up to 100 pages in length. Meanwhile, going through a rental office is vastly cheaper. Application fees are usually between $25 and $400. The materials are far fewer, and although it depends on the building, you likely won’t have to submit to much more than a credit check. If a broker found the apartment, you or the landlord will pay the brokers fee, which is typically 15% of the annual rent.