The Real.Est List
Rent Coach: No dogs for renters, the fine art of rent hikes
Q. I recently rented an apartment in a Manhattan condo building. Before I rented it, I spoke to the owner and some people in the building to make sure I can get a dog later this year. After I moved in, I was told by the management company that owners can have dogs, but renters cannot. Can they do that?
A. Yes. It is not uncommon for the by-laws of a building to have different rules for owners and renters. Sometimes owners are allowed to keep pets, but renters are not. Some people assume that owners will be more invested in the building and thus will take more care to ensure that their pets do not become a nuisance. The board has the right to set the rules in this case.
In addition, any verbal assurances made by the condo owner are irrelevant, as your lease likely states that you have not relied upon any statements made by the landlord, other than those written in the lease. Although most renters don’t take the time, it’s their responsibility to check the by-laws of a condo (or co-op) before deciding if the building will work for them.
Q. I own a building in Brooklyn and, over the years, I've allowed the tenants to pay rents that are well below market rate. The tenants are nice people, but it has gone too far. How can I fairly raise the rent and by how much?
A. If your tenants are paying significantly below-market rents, it's tough to know how they will react if you immediately or gradually step up the rents. I would suggest researching comparable rents in the neighborhood and giving your research to the tenants when you notify them of the increase. That way, you can tie your decision making to fairness by pointing out how much they have saved in the past, while explaining that you’re no longer able to provide them with such a good deal.
You can check out online resources such as StreetEasy.com or the NY Times online real estate section to see what comparable apartments are going for in your neighborhood. If you can, I would even suggest going to see some apartments that are currently on the market to get a real sense of how they compare to the ones in your building. That’s the best way to determine the real value. You can also hire a broker to handle your rentals. In most places in NYC the tenant pays the broker’s fee.
Recognize that while the new rent may be "reasonable," many tenants will struggle to pay more than a 5% increase in their monthly rent. Be prepared for the risk that they will not be able to stay and that you may have a vacancy while you seek a replacement tenant.