It’s a tired truism that renting in New York is financially and emotionally taxing.
The market seems ripe for innovation — and yet renters are slammed with the same frustrations as yesteryear, from finding a guarantor to fronting thousands of dollars for a security deposit. But some startups are trying to disrupt — and improve — the complicated, expensive application process.
Here are six trying to make finding an NYC apartment just a little bit easier.
RoomZoom
In 2013, Elien Becque was an editor at Vanity Fair living in a four-bedroom apartment in Williamsburg with an endlessly rotating roster of roommates. “It was so stupid,” she says. “We were constantly doing work to find roommates” — fielding hundreds of responses from Craigslist posts — “but were lucky if we found two or three people who fit.” And so she built RoomZoom, a site designed to match potential roommates via an algorithm.
Think OKCupid, but for vetted co-living partners.
Becque, 32, left Vanity Fair in 2014 to work on RoomZoom full-time with a small seed grant. Now, she says, the site has tens of thousands of past and present users. Predictably, RoomZoom attracts a young, tech-literate demographic: 95 percent of members are between 18 and 35 years old, and 97 percent are either college students or graduates. (A quick search also suggests the user base skews female.)
Patricia Howard, a 25-year-old cyber security consultant, used the site to find a roommate before she moved to New York in 2015. “I looked into brokers, and I tried Craigslist. It was a nightmare,” she says. “And I wasn’t even [in the city] to look!”
RoomZoom begins its vetting process with an extensive questionnaire, including questions like “How long is it okay to leave dishes in the sink?” and “How often are you cool having people over?” Then the site has a staffer vet all its applicants, accepting about 40 percent of them. The application process also requires users to link a social media account, presumably to verify their identity and lifestyle.
It seems to be a winning strategy. “I loved it,” says Howard. “It was so real and upfront.” Within two weeks, Howard found Chrissy Santariello, a 26-year-old label services coordinator, with whom she still shares a Bed-Stuy apartment. “Our user base is so high quality because it’s screened,” adds Becque. “It’s a trust thing.”
The Guarantors
When firefighter Christopher Russo found his dream rental on the Upper East Side last year, he and his wife applied — and were denied. Though their combined incomes were well above the required minimum — which is typically 40 times the monthly rent of the apartment — the building was hesitant to rent to them because of Russo’s spotty credit history.
Enter The Guarantors. The startup was founded in 2014 by Julien Bonneville, a French expat with his own set of frustrations. After moving to New York in 2010, Bonneville found securing an apartment nearly impossible; as a foreigner, he didn’t have the proper stats — a credit score, for example — or documents — like a US bank statement. In response, he launched The Guarantors, a service where would-be renters can circumvent the high barriers to entry. The premise is simple: The Guarantors take on the risk, underwritten by Hanover Insurance, in exchange for between 5 to 10 percent of your annual rent upfront.
Russo was referred to The Guarantors by his building’s management company. “From start to finish, the experience was pleasant and easy,” says Russo. “I can’t think of any negative aspect. It’s impressive that such a young company is able to do customer service as well as they do.”
The Guarantors saw 15 percent growth every month of 2017, according to Bonneville, and has raised some $11 million from venture capital firms. Currently only in New York, he plans to expand to other cities in 2018. The service is best for those like the Russos, who have no trouble gathering funds to pay The Guarantors’ fee but lack the necessary documentation management companies and landlords require that prove long-term financial health.
Jetty
Princeton buddies Michael Rudoy and Luke Cohler, both 32, launched Jetty in 2015 after facing difficulties meeting rental requirements in New York.
Rudoy and Cohler identified three tough roadblocks: first, an expensive security deposit; second, a high salary or credit score; and third, proof of renters insurance. Jetty offers a separate product for each of these obstacles.
In lieu of a security deposit, the startup charges renters 17.5 percent of the total deposit upfront (a $525 nonrefundable fee on a $3,000 deposit, for example). Jetty pockets the fee, and, in fact, nobody ever pays the full security deposit. But landlords and management companies are protected because Jetty promises to pay them the full amount of the security deposit in the event of damage or other problems.
Onto the second problem. Like The Guarantors, Jetty will also act as your rich relative if need be, providing you with the stellar salary stats you lack for a price — 5 to 10 percent of the annual rent upfront.
Finally, for renters insurance, Jetty quotes a base monthly fee (as low as $5 or $6 a month), including some property and liability protection, with additional charges that earn more protection for possessions like luxury goods or for risks from being an Airbnb host. (Regular renters insurance can start at around $125 per year.)
The intricacies of insurance can be convoluted. Cohler went to Pohs Institute of Insurance to learn the ropes. “What other product can you name that you don’t even know if you have it or what you get?” he says. “We’re creating a brand that is relentlessly focused on making life easier for everyone involved, both renters and landlords.”
Joinery
In 2015, two ex-Google employees, Juliet Ramsey, 32, and Vianney Brandicourt, 33, decided to tackle the rental listings market. Their idea was Joinery, a site that directly connects current tenants looking to vacate their apartments with potential new tenants. The old tenants tell the would-bes about the apartment, show them around and then hand them over to the landlord for lease signing. “The project is really born of the stresses of moving in large cities — the expenses, the hassles and the scams,” says Ramsey.
Joinery hopes to recreate the spirit of that rare beast: the word-of-mouth referral. Ramsey and Brandicourt feel that a tenant-to-tenant transfer is inherently more trustworthy — plus, it comes with potential perks, like furniture exchange. “It’s more friendly,” adds Ramsey.
Most of the apartments on Joinery are fee-free, but current tenants do have the option of charging a finder’s fee — up to half a month’s rent, which is still significantly lower than the standard broker fee, which is usually up to 15 percent of an apartment’s annual rent. Joinery takes its fee, just 0.8 percent of the annual rent, from the new tenant. “The backbone of why we decided to do this,” says Ramsey, “is to put money back in people’s pockets.”
So far, five NYC management companies have agreed to pay Joinery’s fee on their renters’ behalf. Landlords have been enthusiastic, too. “What’s funny is that we underestimated how compelling landlords would find this product,” says Brandicourt. “For them, it’s an extension of an age-old idea: that word-of-mouth is the best marketing.”
Whose Your Landlord
The unlucky know that a vindictive or negligent landlord can turn a nice apartment into a nightmare. With Whose Your Landlord (WYL), founder Ofo Ezeugwu, 25, hopes to grant renters the security of insider knowledge.
Call it Yelp for renters.
The site allows tenants to review their landlords online, for the benefit of prospective renters (and, perhaps, to encourage the landlords to improve). It’s also akin to Rate My Professor, where students pen reviews of their teachers.
Ezeugwu launched WYL four years ago in Philadelphia when he was a senior at Temple University. Since then, WYL has expanded to New York City, and hosts some 10,000 reviews. Unsurprisingly, WYL has dealt with disgruntled landlords. “We’ve probably been threatened with libel lawsuits 10 or 12 times,” says Ezeugwu. “But we know that the Communications Decency Act protects us. Just as Google, Yelp, Zagat and Amazon are protected, we’re protected as well. We’re not creating a slam site. Our goal is to empower and inform renters, and to create more transparency and accountability on the part of landlords.”
The best rated management company, Verco Properties, with an average rental price of $2,150, is lauded on the site for its friendliness and efficiency. The worst, Beach Lane Management, with an average rent of $540, is excoriated for failure to provide heat in the winter and A/C in the summer, attempted evictions and pests, among other complaints.
As for the unexpected (and grammatically incorrect) spelling of “whose” in the site’s name — Ezeugwu claims it’s another way to show its allegiance with renters: “We use the possessive form of the word ‘who’ because we’re giving renters ownership of their living situation.”
NestApple
One Sunday night in June of last year, Maurice Sidi, a French Google employee, was ready to send off the down payment for an apartment he’d found himself on StreetEasy at 7 E. 14th St. — when he happened to turn on the TV. A news program was airing a segment on NestApple, a startup launched that month by a fellow Frenchman, Georges Beoliel, 37, and his wife, Nicole Fishman Beoliel, 32.
Sidi learned that if he listed NestApple as his broker — though they hadn’t actually helped him find the apartment — he would get a cash rebate of 2.2 percent of the cost of the apartment ($567,700). He called the company that night. In New York, buyers are allowed to find representation at any time until contract is signed, a fact few people know. NestApple brokered the deal, and Sidi walked away with $12,700 extra in his pocket — just for making a phone call.
How is that possible? NestApple works by exploiting the current buyer-seller model. In our current system, brokers are entitled to high fees simply for connecting buyers and sellers (in which each side pays 6 percent) — or landlords and tenants (totaling 15 percent of the annual rent). Before the internet, they justified these fees with the knowledge, insider information and connections they provide. But in the era of sites like StreetEasy, Trulia and Realtor.com, listings have become universally available.
That’s where NestApple comes in. It lets you do the work — i.e., find the apartment where you want to live — and then it collects the broker’s fee as paid by the seller (or landlord). It keeps a cut but then returns most of it to the buyer (or renter).
Though Sidi was buying an apartment rather than renting one, the model looks much the same for renters. NestApple collects the 7.5 percent finder’s fee offered to the broker of any rental deal (called an “O.P.” or “owner pays”), and cuts a check for 66 percent of it back to the renter. This is true even for no-fee apartments, because those leases still include the same O.P. fee for brokers.
NestApple outsources its labor — in this case, to you. (Though NestApple is a licensed broker firm, Nicole is its only certified broker.) The labor demands on NestApple are so low that neither husband nor wife have quit their day jobs — as a banker and a lawyer, respectively. The startup likes to think it simply helps you game the system.
The cherry on top of a sweet deal? NestApple always gives 10 percent of its cut to a charity of your choosing.