Most apartment brokers are honest, well-intentioned professionals, but some insist on fighting for their percentage. This forces them to say and do practically anything to close a deal. These tactics can be subtle, deceitful and sometimes dishonest. If you are looking for a new space to call home, you need to be sure to spot the red flags.
1. Fees out of Nowhere
There seems to be a roller coaster of fees when it comes to each broker’s rules. Some demand as much as twenty to thirty-percent of the combined yearly rent. Others try to tack on whatever they can including travel and office supplies. When you register with a broker ask for all fee information up front and on paper. One month’s rent or fifteen percent of the combined annual rent is standard and six percent is the going rate for a sale (unless split with another broker then it is three percent each). The best way to protect yourself is to make sure your broker is licensed. Contact your local real estate board to check their registration and be sure to find out if they have any complaints against them.
2. Waiting Lists
A broker says that there is a waiting list but they are unable to let you see this list to protect those on it. They claim that if you get on this list you will surely get an excellent apartment within six months. In addition, there is a small fee to get on this waiting list. These are all red flags. Most waiting lists are for subsidized housing or lottery drawn apartments. There should never be a fee for this opportunity and if a broker asks you for one, run for the hills.
3. Weak Referrals
There are many professionals that can easily slow down or crush a potential real estate deal. Apartment brokers will often recommend their list of capable, licensed contractors such as mortgage broker, inspector or assessor. These services are sometimes packaged by the broker in a flashy brochure making you think that they are the perfect fit for you. However, if a recommended inspector looks over your home it is in their best interest, monetarily, to green light the deal even if there may be some violations.
4. Too Good to Be True
It is often said that if it is too good to be true it probably is. When selling your home you want to obtain as much profit as possible. Apartment brokers will try to convince you into overpricing your sell. This will put money signs in your eyes and they will get the listing. When your apartment does not sell six weeks later and you have to drop the price, your sale could be too soft, causing a red flag to buyers that something is wrong.
5. Deliberately Starting out of Your Price Range
Apartment brokers will deliberately show you an apartment out of your price range before moving on to one that is in your budget. This immediately deflates your search often causing you to “go for it” and get into a commitment that could possibly cause some serious money problems. Make sure your broker stays on point and refuse any offers to see other unaffordable apartments.