The Case Against High-End Rentals

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Today’s piece by Diane Cardwell in The New York Times made the case that demand is robust and living is easy at high-end rentals, apartments or townhouses — where monthly rent starts at $10,000. The picture is half-right. As an agent who has a sub-specialty in these kinds of properties, I’d like to take a moment to argue against that.

Don’t get me wrong; I think if you’re in a new city for a short time — say three years or less — that you’ll want to be liquid, and so renting is pretty much the only way to go. If you have the advantage of substantial wealth, then it’s natural to expect that your consumer choice will be a fairly large rental with some luxury features.

But I think renting is increasingly being sold to high-end clients as more than that: as a kind of hassle-free fantasy, an environment that allows a retreat from the stress and pressure of their busy lives as a sort of short-term consumable.
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And in my experience (which might save a potential high-end renter some pain), housing is just not like that.

For one thing, the same entropy that is out to get us all is always at work in real estate, and I believe if something breaks, you’d rather be an owner.

I think one of my clients, who paid $13,500 for a three-bedroom in Tribeca in New York City and was caught without the alarm system code when the thing decided to siren during his Super Bowl party, would say the same thing.

Oh, sure, there are technicians to handle broken stuff, and whether you own or rent you have to interface with them. But if you’re an owner, at least they’re your technicians, and you can make them show up with some alacrity. But maybe I think this because I once saw an Emmy-award winner shim a washing machine because the broken machine and the house manager for the property were on different continents. (For your consideration, the tenant did an award-winning repair job).

For another, there’s no privacy anymore. It used to be that renting was a break from the publicity of tax records. If you owned — even through a trust — fans and stalkers would figure it out, while renting allowed you to flit a little more quickly than they did from place to place.

No more. For one thing, press standards have changed, so the short-term address of a public figure like the IMF’s Dominique Strauss-Kahn (famously in the middle of Tribeca) or Will Smith (notoriously in NoHo) isn’t as concealed as it used to be. I — who used to diligently photoshop out any identifying house numbers when I edited the New York Post real estate section six years ago — am guilty of this too, referring to one apartment on West 13th Street as “James Franco’s old place” as though I had ever had anything to do with the rental transaction (I didn’t) or as if the actor’s once living there had somehow made the place more magical (it hasn’t, though the terrace space is still nice).
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Also, the financial standards for renting can be very, very invasive. Long gone are the days when a famous name, a letter from a bank manager, and a big check could land a great apartment. Now, landlords want to perform a degree of vetting one would expect of a buyer. Some of this is a tax-policy problem specific to New York (many luxury rental buildings have accepted tax subsidies that prevent them from accepting a year’s rent prepaid up front) and some of it is a post-Bernie Madoff problem (sure, my client is in/made/wrote/promoted two of your favorite movies, but does that prove he/she has money?)

Finally, in a city, luxury renting isn’t an escape from renovation — yours may be done, but unfortunately, you can hear your neighbors’. Anecdotally, everyone I ever put on a pretty “brownstone block” (in central Greenwich Village, say) finds that their neighbors are gutting a townhouse. That’s not even counting major construction projects, which in Manhattan are currently being hammered-and-sawed in the Financial District, Midtown and Far West Chelsea, or repair projects — there’s a five-year-long water main project taking place in the neighborhood of the Strauss-Kahn hideyhole, which itself just got through a year-and-a-half long gut renovation.

I don’t mean to say that high-end renting is a bad deal, because it’s not. Let me reiterate, before my mailbox fills up with screeds from angry superbrokers, in many cases it’s the best consumer choice. But realize that it’s a choice to acquire square footage and luxury brands, and not calm, privacy, and quiet.

In the modern world, unfortunately, those things may just not be for rent.