[philipdlang]

Brokers are compensated for their market knowledge, not just opening doors. The fast that he was "in" with the management company is hugely valuable, and you were able to take advantage of that. 15% is a lot of money, but brokers meet tens of clients each week that don't rent with them, so they are compensated for that low hit rate as well.

And yes, many apartments are exclusive so you have to pay a full 15% fee (split between the broker who has the listing and your broker).

You could have the greatest collection of listings in NYC and still not solve the "rental issue" because you'll always have landlords that only work with certain brokers, exclusives and apartments that are rented on the spot (with no real-time updates). It is nearly impossible to get a real-time feed of data. I've been in the business a year now and I've seen apartments get rented as I was showing my [interested] client the gym. I've showed up to apartments with clients and, embarrassingly, found out that they've been rented between the time I called to make the appointment and the time I showed up.

The entire system is outdated, and the real fix is one that incorporates brokers to make it easiest for clients to rent.

[infinii]

What market knowledge are you talking about specifically? I haven't met many brokers who wouldn't sell/rent you a place because they felt it wasn't worth it.

Your argument that the 15% broker fee is to make up for a "low hit rate" is pathetic. Many people working in retail see just as many clients with low hit rates, yet they don't make exorbitant six figure salaries.

[philipdlang]

Market knowledge is gained by hitting the streets and knowing which buildings are decent deals. 50% of the time, the renter has a special situation - bad credit, international, needs a guarantor, etc and brokers have to know the buildings and which are flexible. When you go to a broker and tell them you are looking for a $3500 Convertible 2 bed in Murray Hill, they are going to rattle off 5 buildings that have availability. If everybody could do that, there wouldn't be a market for brokers (see lawyers, consultants and just about any other service industry for a comparable).

Most brokers don't make exorbitant six figure salaries, which is why the turnover in the industry is close to 80%. In fact, most make about $40k and leave the industry soon after they enter. Only the top 5% of brokers in NYC are making six figures. Brokers are certainly compensated for the low hit rate, just as bankers are as well. This may be a controversial comparison, but in both industries the professionals work on a success-based transaction fee with a very low probability of success.