Tuesday, October 26, 2021

Startups help work-from-home renters land short-term leases

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New York is a fast-paced city – so why rent so long?

A number of Silicon Valley-backed startups seek to simplify the rental process through inconveniences such as 12-month rents and brokerage fees. They are betting on a new “work from anywhere” lifestyle to give tenants a 30-day waiver rate.
Gustav Andersson, 27, a graduate student at Fordham, is one such move and shaker. It was equipped with a four-bedroom washing machine and dryer in Harlem late last year, using June Homes, a company that was recently leased out on a short-term basis. He pays $ 1,170 a month in rent.

“I’ve rented a few apartments before and finding the right apartment has always been a pain. It took a few months and I paid a lot of money for brokerage, ”he said.

In contrast, startups promise tenants a turnkey apartment within a day (or just three hours in a three-month home) without long-term obligations (New York law sets the minimum rental period at one month).

Andersson adds that because he is a student and does not have a guarantee of a steady income, he appreciates the flexible terms of the lease.

Like Gordav Andersson, a Fordham student, millennials who are happy with software are willing to give up a year’s rent in the event of a layoff from home.

Brokers and real estate experts say New York is now full of home hunters like Andersson, who are looking for no wireless home.

“Very few customers have asked about short-term leases before the pandemic, but now there are many,” said Becky Danchik of Warburg Realty broker.

According to founder Philip Horigan, the Leasebreak short-term rental market has seen twice as much traffic to its site since the start of COVID.

“We’re seeing a new lifestyle that’s attractive, affordable, and flexible,” added real estate appraiser Jonathan Miller. “To stay here.”

Exterior of Andersson's apartment building in Harlem.
Gustav Andersson used his June homes to find shelter in Harlem (above).

Other companies that operate in the short-term space include Blueground, which offers 30-day rentals, and Sonder, which manages hotels with multiple divisions for long-term stays.

For investors and homeowners, a more temporary culture means higher returns and greater returns.

Blueground recently raised $ 258 million and operates a portfolio of nearly 5,000 apartments in 500 locations in 15 cities around the world, including Los Angeles, London, Paris and New York. Meanwhile, June Homes has raised $ 50 million from investors, including SoftBank and singer Demi Lovato. The company currently rents out more than 800 apartments in New York.

The interior of Andersson’s Harlem House.
Andersson collected a room inside the four-bedroom building for $ 1,170 a month.

“We do the necessary repairs, paint, install lighting fixtures, install furniture and spare the kitchen,” said founder and CEO Daniel Mishin, adding that the company’s average lease term is 9 months before the pandemic, but that’s it. said to have decreased over time. five “When you enter, it’s bright and new.”

The June list of homes typically belongs to small homeowners who are struggling to compete with the amenities and services offered by real estate leviathans such as Brookfield and Alokador. By connecting with the brand, they benefit from high-tech software and plug-in game processing services — an advantage in the city’s shark rental market.

“When we have to work remotely here, we see people wandering around the cities or extending lease terms.”

Alex Chatzieleftheriou, CEO and co-founder of Blueground

For example, Park Slope entrepreneur Pir Granoff, 31, owns a four-bedroom building in Crown Heights that he rents out in June. He said the company saved him a lot of time and money.

“I’m a parent landlord, so I have to deal with filling out apartments, collecting rents and requests from field tenants,” she said. “The challenge that June houses take away. My tenants use the five-star service, and so do I. “

In fact, Granoff had such a positive experience at his home in June that he recently invested in an eight-bedroom apartment building in Chinatown.

Finding an apartment through Blueground works like it did in June: interested tenants can take a virtual tour through the company’s website and fill out applications online. All appliances are furnished and have a modern design that emphasizes floor tones.

“When we have to work remotely here, we see people wandering between cities or extending lease terms,” said Alex Chatzieleftherio, CEO and co-founder of Blueground.

One of the remote workers is 30-year-old Sim Cheema, who works at a commercial bank and rents through Blueground.

Photo by Simarjot Cheema and Daniel Piexler.
Simarjot Cheema and Daniel Piexler (above) quickly found unity through Blueground.

This spring, when Cheema and her husband, a 31-year-old tech startup founder, returned to the U.S. from Dubai, they didn’t want to be locked together.

“We liked the idea of ​​living temporarily in different cities, now we can work remotely,” he said.

They stayed in San Francisco for a few months and then moved on to rent in Williamsburg.
They will return to Dubai this fall to get married and return to New York by January.

“We see the world and do it innocently because we are not financially connected to any city,” Cheema said. “We don’t have to install Wi-Fi or buy furniture.”

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