Source: RentHop. De-trended seasonal mean rental prices based on 1-bedroom units in New York between $1,000 and $8,000 dollars.

Ahoy Hoppers!

Earlier this week we did a post on the “Best Time of the Month to Look for Apartments in New York,” and you asked “But what’s the best month to be looking?”

Let’s dive into our data!

The chart above shows the relative difference in average rent prices per month. Just a quick look shows you that rates clearly increase from July through September. We’re looking at a 3% increase from yearly average rents, or roughly $90-100 extra a month for a $3,000 unit!

Verdict: It looks like April and November are the best months for smart Hoppers. Now what will you do with your extra $1200 a year!?

Happy Hopping!

Apartment Hunting – Photo by BKLYN guy on Flickr

Hey NY Hoppers,

People often ask us: “What’s the best time of month to look for apartments in NYC?” Let’s look at the options.

First Dibs: The general consensus is that it’s best to start looking one month before you move, as close to the 1st of the month as possible. Why? Most people have a lease that terminates at the end of the month, leaving apartments open starting on the 1st. If you schedule your search at the beginning of the month you’ll get first dibs on the best apartments.

The first “apartment” I lived in when I moved to NYC in 2004 was not so much an apartment as a dorm room in the little-known—and highly underrated—neighborhood called Morningside Heights.  This area is most notably home to Columbia University.  In ambiance and identity, it is what the Upper West Side aspires to be—liberal, intellectual, conspicuously unfashionable, beautifully residential.  It became the place I called home for the better part of 7 years of my nomadic apartment-hopping NYC life.

As an apartment-seeker, there are several key things to note about Morningside Heights.

Firstly and arguably most importantly, location—where exactly is it?  The natural boundaries are 110th Street to the south, 120th Street to the north, Morningside Park to the east, and Riverside Park and the Hudson River to the west.  However, I think it’s fair to say that it extends as far south as 96th Street and as far north as 125th Street.  The main subway line is the 1, with local stops at 103rd, 110th, 116th, and 125th Streets, connecting to the 2/3 express trains at 96th Street.  Commute time to midtown is 20-30 minutes.

This leads to the second question—it’s pretty far north…is it safe?  Yes!  I am a small, single Asian chick.  If it’s safe for me, it’s safe for you.

Thirdly, a more general question—what’s the neighborhood like?  Eminently livable, arguably serene.  Morningside Heights offers a high standard of living at a discount.  It is perfect for families, young professionals, and unemployed homebodies (if you can swing the rent, more power to you).  You should consider it if you want all the conveniences of city life away from the hustle-and-bustle and rampant commercialism that accompanies it.

Restaurants and stores are concentrated on the main drag, Broadway, south of the main gates to Columbia University’s campus on 116th Street.  They include the iconic Tom’s Diner from Seinfeld and dining options that range from French to Korean to take-out falafel.  There are plenty of gorgeous pre-war buildings around Broadway and low-rise walkups on side streets. Elegant pre-war (mostly) doormen buildings line Riverside Drive one block to the west.  On Riverside, you can take in the majestic views of the Hudson and the George Washington Bridge, enter the park below, and access the Greenway for a stroll or bike ride along the western contour of Manhattan.  East of Broadway is Amsterdam Ave, which is a bit colder in architecture and devoid of the greenery characterizing Riverside but more affordable.  One standout landmark is the Cathedral of Saint John the Divine.  The adjoining garden has free-roaming peacocks.  It’s disorienting and magical.

It’s not for everyone.  If you like the meatpacking district, and you’re not foreign, it’s likely not a good match.  If you can’t handle occasionally sharing the sidewalk with some punk underage drunk kids swaying up Broadway after a night of carousing, you might be happier elsewhere.

These punk kids, along with faculty, occupy most of the neighborhood and define its university culture.  Yes, there is an American Apparel, a Chipotle, and the requisite delicious pizza place that serves up cheap jumbo-sized slices (Koronet’s Pizza).  On the flipside, this culture breeds unique gems: (1) Labyrinth Books (renamed in recent years to Book Culture, a silly name I refuse to recognize) is the best, most esoteric, and outrageously pretentious bookstore in the city, (2) the Hungarian Pastry Shop, where lingering for an entire day refilling the same mug of coffee is considered a generally accepted practice.  Some people study or read, others are working on their magnum opus.  These institutions would not thrive elsewhere in the city.  Lastly, I feel obligated to mention that the best bagels in NYC can be found at Absolut Bagels on 108th and Broadway.

I originally moved to Morningside Heights because I had no other option.  Literally.  Columbia required all freshmen to live in dorms.  And looking back, I’m glad I did.  I will continue to bounce around and inhabit other NYC neighborhoods, but Morningside Heights will always be a place I consider home in some way.

When I started apartment-hunting this fall, I thought I would end up in Brooklyn. It seemed like a good value proposition, and I wanted to live in a laid-back neighborhood with creative young people and a feeling of community. It turns out the cheap Brooklyn I remember from my early 20s no longer exists. The more surprising discovery, however, is that the Upper East Side is actually more affordable than Greenpoint. That’s how I ended up in my lovely one-bedroom apartment on 89th Street between 1st and 2nd.

I’m not the first aspiring Brooklynite to make this choice. There’s a bastion of young, fun people on the Upper East Side who have also discovered that (1) the economics make sense and (2) the UES is not at all the stuffy, boring neighborhood people think it is. Sure, there’s probably a higher concentration of sterile buildings, overdressed dogs, and overmedicated (and underdressed) housewives here than in other parts of the city, not to mention wealth, but that’s part of what makes the neighborhood interesting. It is also legitimately a really fantastic place to live.

Here’s what my day looks like on the Upper East Side.

My first activity is to double-fist a coffee and Kombucha. In an ideal world, I do this while walking to the gym. Starbucks is omnipresent and perfectly delightful, but I like to go to The Brown Cup (2nd Ave between 88th St & 89th St) for a damn good iced latte. One of my more exciting discoveries is that Kombucha is like water on the UES. I can even get it at the C-Town on my block.

On an ideal day, I do get 30 minutes of cardio in, though I’m not sure the elliptical really counts as cardio. There are two New York Sports Clubs conveniently located within blocks of my apartment. When I really feel like torturing myself, I go to Bikram Yoga or SoulCycle, both on 83nd and 2nd Ave.

Food is important. In particular, I can’t live without bagels (it is literally listed as an interest on my resume, which is admittedly kind of lame). No East Side bagel shop has been able to hold a candle to Absolut Bagels, but Tal Bagels (86th St between 1st Ave & 2nd Ave) passes muster, and Sable’s (2nd Ave between 77th St & 78th St) apparently has the best smoked salmon in NYC.

While the Upper East Side doesn’t have the best restaurants in the city, it does have some great ones. For dinner, I like Café D’Alsace (French, 2nd Ave between 88th St & 89th St), Beyoglu (Mediterranean, 3rd Ave between 80th St and 81st St), JG Melon (burgers, 3rd Ave between 74th & 75th), Pinocchio (Italian, 1st Ave between 90th St & 91st St), Cascabel (Tex-Mex, 2nd Ave between 80th St & 81st St), and Shake Shack (86th St between 2nd Ave & 3rd Ave).

Liquor stores, bars, and pharmacies per capita are disturbingly high on the UES, as are psychologists. There are a plethora of sports bars, most of them undistinguishable from one another at this point. I’ve been told that I need to find one that does buybacks like Swigs, which I have yet to visit. There are a few good bars/places to drink like Trinity (84th St between 2nd Ave and 3rd Ave). It’s more of a restaurant than a bar, but Liberatador (89th St & 2nd Ave) has a cucumber Caparinha dubbed 89 Street that is delicious. The beer selection on the UES is generally piss-poor, which surprises me greatly. There are very few craft beers to be found. A new beer store/bar called City Swiggers (86th St between 1st Ave & 2nd Ave) remedies that problem.

For dessert, Two Little Red Hens has the best cupcakes in NYC hands-down, possibly the world.

When I’m not drinking or eating, which is rare, I appreciate the proximity to Central Park, the East River, and the best museums in the world.

Lastly, I think the new Fairway on 86th between 2nd and 3rd Ave should be reason enough to relocate to or stay on the UES.

After two months, I have grown to love the Upper East Side. It is a real neighborhood (I actually know my neighbors!), and the lifestyle is comfortable and convenient. We’re all New Yorkers leading incredibly busy lives. In Brooklyn, I would have to walk half a mile to do most of the things I would want or need to do. On the UES, everything is within a three-block radius of my apartment. I’m also pretty sure it’s possible to get a manicure at any time of day. These little things make life a whole lot easier.

Over the next few weeks, we’ll be putting out our own string of neighborhood profiles for our renters. We’re starting off with Battery Park City - located near the southern tip of Manhattan. There, renters can find a number of no-fee luxury high-rises with a wonderful view of the surrounding rivers. Without further ado, we present…

Battery Park City Spotlight

If you’re thinking about moving to Battery Park City, keep that thought. You are on the right track. Bordered by Chambers Street and Battery Place in the North and South, and West Street and the Hudson River in the East and West, Battery Park City will charm you into moving there.

The neighborhood has the prestige of being the “newest” neighborhood in the city. Conceived in the 60’s, construction only began in the early 80’s. Since then, though, there has been a steady stream of renters. In fact, the 2010 census rang in at a tad over 13,000 residents.

Harbor at Battery Park City

Battery Park City’s name is derived from the 25-acre park that lies south of it (Battery Park), and it was built on landfill that was excavated from the World Trade Center and other construction sites around the city. Surprisingly, 9/11 had only a small impact on the neighborhood. Despite renters being understandably spooked in its aftermath, the neighborhood bounced back pretty quickly and is now as strong as ever.

When walking through the quiet streets of Battery Park City, you can’t help but feel the suburban atmosphere. With the park as its backyard and the Hudson River and the ever-growing Jersey City skyline as its backdrop, the neighborhood attracts newcomers looking to live in modern yet affordable buildings. The excellent bike path that runs along West Street is a great perk as well.

Most of the residential buildings that have been built in Battery Park City during the last eight years are proudly “green”. In fact, the neighborhood has the honor of developing the first residential LEED-approved building in Manhattan built on its “recycled” earth: The Solaire at 20 River Terrace (LEED is a nationally accepted rating system created by the United States Green Building Council). Other buildings  followed its lead, and the neighborhood currently touts its sustainability as a major drawing point.

There are no walk-ups or buildings older than twenty years here, so if that’s your thing – Battery Park City might not be the place for you. However, if you are interested in a neighborhood that is green, clean, hip, and whose buildings have every amenity imaginable, you’re looking in the right place.

If you’re a budding financier, you’ll be happy to note that many financial firms are located near the lower tip of Manhattan. If you happen to be working at one, Battery Park is an excellent place to start your apartment search.You’ll be able to walk to work (now how many New Yorkers can say that?) in a relatively short amount of time, and not be stressed out by the morning commute. Then you can use those extra two hours to play in other people’s neighborhoods, always knowing that a placid town awaits your return each night.

One of the most interesting discoveries we’ve made while creating and growing RentHop is that not all brokers are equal.  We originally began with the premise that the Internet was turning real estate professionals into over-priced commodities, prepped for a huge sell-off in prices, but we were wrong.  Excellent agents certainly earn their keep, compared to the zero-value or even negative-value renters receive from the mediocre masses.

As nerdy software engineers turned real estate startup founders, we love building quantitative models in an attempt to automate what is normally a very human task.  This time, however, we’re throwing you a curve ball.  We are NOT trying to automate the real estate professional; instead, we are tackling the still difficult but more tractable problem of automatically determining which agents are likely to be good!  Inside our RentHop labs (aka an emacs buffer in the cloud), we constantly tweak our secret ranking algorithm to show you only the best apartment listings first.  While we guard the exact formulas quite closely, today we’ll shed some light on how to infer professional, helpful, and responsive behavior.

Take the two search rank summaries from two actual listings on our site today:

First, we have a listing that would normally receive an above average score ranking poorly.  The broker in this case has not yet verified all of his contactinformation with us so we are not able to display it openly to renters for direct contact.  Also, we carefully track every account’s historical behavior, so we can see that for previous listings by the same manager, many renters have attempted to make contact and did not hear back promptly (renter’s are an impatient bunch; anyone not receiving a reply within a day or two is as good as gone).  Finally, the manager has not logged in to update any price changes or availability changes for quite a few days.  In this peak season market, apartments are moving quickly!  A listing without some update for over a week is very much in danger of being stale.

In contrast, the landlord on the right side has done lots of good things.  He has received excellent feedback over his account’s history from renters, and he has fully verified all of his contact information with out listings department.  More importantly, his day-to-day interactions with renter’s has been upstanding.  He logs in on a daily basis to remove old listings and update information on any changes, and he consistently responds promptly to questions from renters and requests to schedule appointments.

There is a lot more to being a good broker than speedy blackberry reflexes or obsessively good customer service, but it’s shocking how many don’t make this basic cut.  Just know that when you are browsing NYC Apartment rentals on our site, we are doing our best to shield you from those prone to serving you lots of radio silence.

Congratulations to Guillaume Derouet for posting our one millionth New York City rental listing!

http://www.renthop.com/listings/waverly_ave/_/1000000

We actually didn’t expect to cross the mark until near the end of the month, but the renter AND landlord activity has been growing at a break-neck pace.  Keep of the good work everyone; I’m so glad the community continues to thrive and evolve.

Many of you have also noticed the recent design changes that Lawrence has implemented, both in the landlord dashboard and the main list-based apartment search.  However, one of my favorite changes has been the new and streamlined NYC apartment map search.  When we first began, three years ago, the map page was our original and only search mode!  Back in the day we plotted every listing in Manhattan on the Google map, using some clever JS hackery to keep the performance acceptable while juggling thousands of listings.  As we’ve grown, however, we realized that renters tend not to want to see every possible listing.  It’s much more important just to see the high quality, highly relevant posts.   Now, for the first time ever on RentHop, we’ve fully integrated our trust score and search rank algorithms alongside the location-based filtering.

Give it a shot!

Within the next few days, we are expecting to reach our one millionth NYC apartment listing ever posted on RentHop.com!  If you are the lucky landlord or broker to hit the big million, then let us know and we’ll gift you 1,000 free RentHop credits for posting on CraigsList, buying featured listings, or many of the our premium features in our landlord dashboard.

Bloomberg Businessweek reports today Manhattan Apartments Lure Investors Seeking Market Foothold.  Down in the rental trenches, we’ve seen a lot of building transactions as the 2008 financial crisis dislocated REIT balance sheets across the country.  One notable includes Longacre House in Midtown West, one of our original RentHop landlords.  In the middle of 2009, they transitioned from a Macklowe, famous among brokers for generous OP and free-rent incentives, to ownership under EQR, one of the largest REITs with a strong Manhattan residential presence (and sadly very few OP payments).

An interesting paragraph in the Blomberg piece stood out:

Demand for Manhattan apartment properties has pushed up prices and lowered the yield for investors. Capitalization rates on multifamily buildings in the borough averaged 5.1 percent in the fourth quarter of 2010, compared with 6.6 percent nationally, according to Real Capital.

The capitalization rate is the real estate equivalent of the P/E ratio in equity fundamentals, except that it is quoted as the percentage of the property purchase price earned each year in net operating income.  In simpler terms, for every $100 used to buy real estate in most of the country today, a building owner expected to earn $6.60 per year.  In Manhattan, a building only expects to return $5.10 per year, almost 23% less income for the same price!

Of course, when evaluating any investment, the cash flow yields are not the only concern.  After all, a cap rate doesn’t consider cost of financing, and when was the last time anyone bought a stock solely because of its high dividend yields? (I’m assuming value/income mutual fund managers are not RentHop blog readers)

I suspect there are a few reasons to be bullish on highrise landlording in Manhattan:

Financing rates are near an all-time low.

After almost three years of large real estate deals gone bust, banks are finally taking on a bit more risk and that includes providing attractive financing to experienced real estate investors.

Cap rates in Manhattan traditionally trade below the nation.

In 2007, cap rates for luxury highrise residential buildings are comparable to what they are now.  Keep in mind that Manhattan rental prices during the 2002-2007 boom rose at a much greater pace than the nation.  The cap rate only captures a snapshot of net-operating-income the year prior to the purchase divided by the purchase price at closing.  If the investors can rely on rents to rise at rates significantly faster than inflation, then the actual returns over a multi-year holding period can be significantly higher than the cap rate (couple that with low borrowing costs and you’ve got a recipe for a great cash-on-cash return).  Unfortunately for renters and brokers, that also means we should expect rent increases in the coming years.

Plain and simple, investors like to bet on appreciating assets.

It’s a sad truth in real estate, but quality property management and reliable tenants are not the primary concern for owners.  Most landlords know that annual cash flows and yields are simply the icing on the cake, and that the real money in real estate is flipping a property at appreciated prices, often with a healthy dose of leverage and intelligent tax planning.  Professional real estate investors obviously care about maintaining healthy income statements, but in the end the balance sheet is king.   Other than a few distressed opportunities such as Florida, Vegas, and Michigan; one of the best metro areas due for a real estate turnaround in Manhattan.  It’s definitely a gamble on a large rebound in the financial sector and Silicon Alley bidding up housing demand, but year over year rents have been quite encouraging.

As always, we do our best to follow the NYC Apartments market and watch with great interest as the Manhattan recovery continues to develop.

Best location in Forest Hills – Size Matters

Apartment 2K– Fully Renovated 1BR with private balcony * 875 SF * $1900
Our Largest One Bedroom, kitchen features granite countertops and stainless steel appliances, marble bathroom with hand carved vanity. FLOOR PLAN

Apartment 6W – Corner Two Bedroom with private balcony * 1033 SF * $2050
Gigantic Two Bedroom Apartment, corner private unit, new wood flooring throughout, large living room, abundant closet space. FLOOR PLAN

Apartment 16V – Fully Renovated 3BR with private balcony * 1327 SF * $3000
Fabulous Three Bedroom featuring kitchen with granite countertops and stainless steel appliances, two marble bathrooms with hand carved vanities, huge private balcony, and great views. FLOOR PLAN

Call us today for the latest updates of our new listings.  888-256-0135

Email me, Shari Forrest, directly with any questions HERE

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