The pandemic reduced my paycheck. Can I still rent a new apartment in NYC?
Some landlords may be willing to work with you if you have a solid credit history and can make a good case for yourself and your finances.
I need to rent a new apartment but my pay has been cut temporarily because of the pandemic. Will I be able to rent an apartment? What will landlords think about my situation?
Many New Yorkers have lost their jobs because of the Covid-19 pandemic. So if your salary is reduced only temporarily, you may be in a better position and might be able to work something out.
Landlords are showing more flexibility with current tenants when it comes to lease renewals, early move-ins, and some are working out arrangements with tenants who have lost their jobs on a case-by-case basis. As a new renter, some landlords may be willing to work with you if you have a solid credit history and can make a good case for yourself and your finances.
“Landlords want to see that you’re self-aware, so if you can demonstrate that you’ve never missed a rent payment, have a high credit score, and strong financials, or even have a guarantor lined up just in case, they’re going to be more willing to work with you,” says Brian Lewis, a broker at Compass. “The landlords I work with are very open-minded about everyone’s specific situation.”
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Landlords typically require your annual income to be at least 40 times the annual rent—but in your case, it will be tough to find an apartment that factors in your current reduced salary. Stan Broekhoven, a broker at Keller Williams, recommends renters in this situation use a personal guarantor or a third-party guarantor service like Insurent.
A personal guarantor is typically a parent or other relative who agrees to be legally responsible for your rent in case you default. They need to make at least 80 times your annual rent, in order to cover your expenses plus their own. Agreeing to be a guarantor is a big financial responsibility, and not a decision to take lightly.
Insurent Lease Guaranty (a Brick Underground sponsor) can serve as your guarantor if you make 27.5 times the monthly rent. Your guarantor can also use them if they make at least 50 times your annual rent. The company also guarantees renters whose cash assets or marketable securities are a minimum of 45 to 50 times the monthly rent.
When affordability is your primary concern, there are some other options to consider, such as subletting, taking over someone else's lease, or becoming someone's roommate—all options which typically allow you to avoid a broker fee. There are real estate sites you can search specifically for these situations, like LeaseBreak, Flip and RentHop (and check out Brick Undergrounds 12 best websites for finding a roommate).
Renting in a co-op or condo building may work in your favor. You will still have to get approved by the board, but because the owner is responsible for paying the monthlies, a board may be more willing to consider your whole financial picture, rather than just your temporary salary setback.
"[Before the pandemic], rental buildings that I worked with purely went on the basis of income. At the same time, when I vet applicants for co-op and condo buildings with rental units where I represent the owner, references from previous landlords, professional/personal references, credit score, employment, and the overall financial profile determine the viability of a renter," says Victoria Vinokur, a broker at Brown Harris Stevens.
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