Wednesday, April 08, 2009

Stories From The Real Estate Trenches

It was a doozy of a week over here on Planet Pauline. Two deals closed, but not without a little drama thrown in, just to keep life interesting. For every easy deal I close I get at least a pair that are breach birth. They come out eventually, but not without a little heave-ho.

The Mysterious Landlord/Tenant Complaint

I had a pair of clients, a couple, who were the coolest and nicest people ever. They had two criteria: outdoor space and a place that would take a large, lovable pooch. The first two apartments they loved were snapped up quickly, but eventually they found a place smack in the middle of Chelsea that had a terrace that could literally double as a dog run.

They're both employed and make a great living, so I figured it would be easy to close. Not so fast. The leasing agent at the luxury building they applied to called me and asked what the tenant/landlord complaint that was popping up on his credit report was all about.

"The which?" I asked. "They never mentioned any problems with a landlord."

"Most people don't," the leasing agent said smugly. "This needs to be cleared up, in writing, pronto. Otherwise I have someone else in line for the place."

And thus began a day and half long battle to get someone from my client's chop shop management company in Long Island to send a signed letter that stated that he was a good tenant and the tenant/landlord complaint in the City Clerk's office was based on a misunderstanding.

As the story goes, in 2007 my client was working abroad but still paying for his empty apartment in Manhattan. He paid in three month chunks, and one check was late getting across the pond. As is typical with many management companies, instead of calling him and asking him if something was wrong, accounting automatically forwarded the unpaid account to legal, who in turn filed a complaint with the City Clerk. My client should have received something in writing about the complaint, but doesn't remember getting one. They usually look like this.

After much back and forth we got someone to fax over a quick letter, my client was approved and the lease signing was all hugs and smiles, as they often are. The larger issue is getting the complaint erased from the City Clerk's office, since if it showed up on a credit check for a rental, it will most likely come up again if he applies for a mortgage. These days, you don't want anything trivial to stop you from getting a mortgage.

Moral of the story: If you ever have an issue with a landlord, even one like an accidental missed rent payment, make sure you address it immediately and get any resolution in writing. I don't know what we would have done if my client hadn't gotten this place. We'd probably be out looking right now.

No Children, No Pets, No Actual Apartment!
For a few weeks I had a listing for a two bedroom up by Columbia. It wasn't the grandest apartment that ever existed, but for a pair of students or someone looking for a deal, $2000 a month was a good price for 700 square feet.

It showed over and over, but since it wasn't renovated and the floors were industrial-grade tile, no one was biting. Until Monday night! A broker from another company called and said she was zipping over an application. The applicants were a working class family of four, with two young sons. I was excited and called the owner, who I was sure would be over the moon that her little dump was finally rented. Not so much.

"That's no good," Ramona, the owner said. "I told you that I don't want a family in there. I want two young professionals, preferably girls."

I couldn't believe what I was hearing. "You can't not rent to someone because they're a family," I said. "That's against every Fair Housing Law known to man."

"It's not big enough for a family," she said.

"It's 700 square feet. It's plenty," I said. "They're financially qualified, have good credit and can move in this weekend."

"Is this how it works with brokers?" she asked. "You tell me who I should rent to?"

"In this case, yes," I said.

Then she dropped the bigger bomb: When she came into the office to give me the listing back in March, she said that even though the unit was in a co-op, there was no board approval. True, there are buildings like this, especially in slightly dumpier parts of town. Since the unit was being shown as often as it was, it got the attention of the board president, who called Ramona to see what was up. Seems that good old Ramona never cleared renting the place out with the board, who are now hot on her tail. She claims ignorance, which I don't buy for a second considering that she's a CPA. If there's anyone who reads the rules on the back of the boardgame's box, it's a CPA.

Within minutes of hanging up with Ramona I e-mailed our listings department and pulled the listing. Her keys are waiting at the front desk of my office, which oddly she hasn't picked up. (Maybe she's too busy wiping the egg off her face.) So even if she hadn't discriminated against the family of four, whoever moved in there would have likely been tossed out in a few months time. Klassy.

The day after Ramona wouldn't rent to the family, I got a called from yet another broker who had two young girls who wanted the place, deposit and application in hand. Maybe a lesser broker would have sent their app to Ramona, but knowing what I knew, that it was an illegal co-op sublet, I told him it was off the market. No commission was worth the headache I would face when those girls were tossed out in a few months.

If I could drink, I'd be doused in Bordeaux right now. Maybe even a bottle from 1982.