It’s often difficult to evaluate a potential place to live based on the cost of rent alone.
That’s because some landlords, including the largest owner and manager of apartments in the U.S., add a variety of fees to the monthly bill — and it can be difficult to fully evaluate those costs before you move in.
An investigation by The Guardian identified a wide array of fees charged by Greystar, which manages some 200,000 apartment units in Texas, including substantial numbers in Dallas, Houston and Austin.
Reporter Tracie McMillan says some fee names, and their purposes, confuse renters. Listen to the interview in the player above or read the transcript below.
This transcript has been edited lightly for clarity:
Texas Standard: Tell us about Greystar, especially their footprint in Texas.
Tracie McMillan: As the biggest owner and manager of apartments in the country, they’ve got more than a million units that they oversee and almost a quarter of those are in Texas, where it has about just over 200,000 units.
Houston proper’s got about 44,000 units, Austin proper, 32,000 units, the Dallas-Fort Worth market area has about 57,000 units. So it’s quite a lot of power over folks’ housing.
Well, tell us about these fees. What are they for? How much money do they add to a tenant’s monthly rent?
So we found 125 different named fees across the country at various apartment listings. They can range anywhere from a dollar or two a month for something like pest control, all the way up to hundreds of dollars to cover utilities that are provided in common areas and in units of the complexes. So there’s a real range, and there’s a mix.
Like there’s going to be some that are mandatory. We found, in the in-depth analysis we did of about 18 leases, most leases had between five and 11 mandatory fees. The leases are usually written in a way where you can be evicted for failing to pay those fees that are on top of your rent.
And then there will be optional fees, move-in fees, and then something that Greystar called situational, which is everything from you get locked out and need a new key to damage in the apartment.
So you focus on an apartment complex in Addison in North Texas. What did you learn about the fees there?
So at the Addison Grove complex, we found 13 mandatory fees. About half of those are a set flat fee, so you’re looking at things like $16.75 a month for boiler management, $2 a month per pest control, and then you’ve also got a range of usage-based utilities. So that would be things like your electricity, third-party storm water and drainage. You’re also looking at renter’s liability insurance.
And so when Greystar does their pricing, they roll those those flat fees into the rent, but not the usage-based fees.
Okay, so I just have to ask, what is a boiler management fee?
We did not get a clear answer on that from Greystar. We did ask about them.
Our understanding is that it is related to maintaining the heating system. And in fact, there’s a lawsuit in Colorado, arguing that boiler management fees are an unfair shifting of basic costs of running a building, like having a heating system.
So you quote Greystar as saying the fees are disclosed to renters. Is that accurate based on your reporting? Do renters fully understand what they’re paying for and why?
I think things are disclosed on the website, and if you read every line of the lease and know what to look for, I think you’ll find most of the fees, if not all of them.
I think there’s also a real shift where property managers and landlords now pull out a lot of fees for things that traditionally have been included in rent, and so tenants don’t necessarily know to look for them and sort of skim over them if they’re not familiar with that being a separate cost.
So are there any state or federal laws that address these fees? Or are those fees just, if you disclose them, that’s how it works.
I mean we’re sort of on the leading edge right now around regulating junk fees and housing. A number of localities around the country do have protections in place for renters around specific kinds of fees for renters.
There are a couple of efforts at the federal level to regulate this stuff. So you do have a bill from Democrats about ending junk fees in rental housing. Again, there’s no Republican co-sponsor so that doesn’t seem to be moving in any direction.
Right now, the Federal Trade Commission is doing rulemaking around regulating junk fees in rental housing. So we’re likely to see some kind of regulation come out of that agency this year. But it really remains to be seen how much they’re going to regulate, what they’re going to allow.
I do think Greystar’s current pricing model — where they roll the cost of flat fees into the rent but leave out anything that’s usage-based — that might be a model because it’s based on a settlement that Greystar had with the FTC in December and is sort of what Greystar now is out there saying, “look we know how to do this. We believe in transparency. Let us roll these fees into a total monthly leasing price. But we don’t that anything that’s usage-based should be included.”
