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A real estate broker representing an Upper West Side apartment was charging a broker fee worth more than four times the apartment’s monthly asking price, according to a recent report.
The apartment listing, which has since been edited, reportedly described a $2,191 one-bedroom with a firm $9,205 broker fee.
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“Rent stabilized once in a year opportunity! 40% below market rent! Gut-renovated unit, doorman/elevator building. Broker fee is 35% of one year’s rent ($9,205). No negotiating! We Will have a lot of interest; best application will get the apartment. Good luck!”
The Streeteasy listing for 226 West 97th Street, 7B names Nathan Benelyahou as the broker, and indicates the apartment was only listed for a single day before being rented. Neither Benelyahou nor the company on the listing, Nathan Joseph & Associates Inc., responded to a request for comment.
Zillow’s market trends say the average monthly rent for a one-bedroom apartment in New York City is $3,772 per month. Narrowed to just the 10025 zip code, that monthly average rent rises to $4,664.
Broker fees in NYC typically range from the equivalent of one month’s rent up to 15% of a year’s rent. Based on that range, a broker fee you’d expect from an apartment of this cost would fall in the $2,000 to $4,000 range.
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Not all renters in NYC are required to pay a broker fee; some brokers are paid by the landlord, while other apartments are rented directly from the landlord or management company without broker involvement.
NYC recently passed the Fairness in Apartment Rental Expenses (FARE) Act, which prevents renters from having to pay real estate brokers they did not hire. The law goes into effect in June of this year, though it should be noted that the years-long fight against broker fees has seen several unsuccessful attempts.
After publishing this post, an anonymous tipster told us that Nathan Benelyahou is also the owner of 226 West 97th Street. According to Commercial Observer, he bought the building–along with 2568 Broadway, which it’s connected to–for $42.8 million last year.
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Small ball.
Now he has a forever tenant.
So the broker is also the landlord, making the broker free really key money? Is this legal?
I reported this as illegal and fraudulent to streeteasy as soon as I saw it. The greed exhibited by this owner is unbelieveable, but par for the course in NYC these days.
Has anyone sent this Article to the Real Estate Board of NY? This is where it should go This behavior reflects on all of us in Real Estate and it’s nothing more than pure greed. It’s shameful.