Rental Red Flags: 10 Signs You Don't Want That Apartment

I'm all for renting rather than buying an apartment, if that's where you're at financially, socially or economically. But the last thing you want is to rent an illegal apartment.

How do you know an apartment is illegal?

Recently, New York Buildings Commission Robert LiMandri issued a report featuring 10 tips for renters on how to recognize the signs of an illegal apartment that could endanger the safety of its occupants, neighbors and first responders.

The list came about after a Department of Buildings undercover investigation into illegal apartments advertised on Craigslist. Investigators posed as potential tenants in order to inspect 62 buildings throughout New York City. (In November 2009, three people lost their lives in a fire in an illegal cellar apartment in Queens, after which the DOB launched a city-wide campaign to educate residents on illegal units, defined as units that were illegally altered without proper permits in order to create additional housing.)

What did they find? Illegal conditions were found in 54 of the apartments for rent, including 33 properties where vacate orders were issued because the conditions posed an immediate threat to public safety. As a result, the Department issued 104 violations to property owners who created illegal conditions, including fire safety hazards such as inadequate means of egress and illegal gas, electrical and plumbing work. Monthly rents for these apartments ranged from $750 to $1,200.

"An illegal apartment might save you a few dollars â€" but it may end up costing you your life," said Commissioner LiMandri in a press release accompanying the study. "Some illegal living spaces are clean, spacious and still have only one exit in case of an emergency, which can easily lead to tragic consequences for you and your family. Property owners who create these types of conditions are deceiving tenants and putting their safety at risk, and that's why it's so important for New Yorkers to understand the potential dangers. Every tenant should ask questions, conduct research and confirm whether the advertised living space is legal and if construction work was performed with proper permits."

1. Know the market. Be wary of units that advertise significantly lower price points for comparable apartments in the area.
2. Beware of the words "basement" or "attic." Advertisements that use these words are often for apartments that typically lack adequate exits.
3. Avoid apartments that have rooms without windows or very small windows. These are often found in illegal cellar or basement apartments. Landlords will sometimes describe the ones with very small windows as "sunny" to entice renters.
4. Beware of the word "flex." "Flex" implies that the apartment can be converted into a multi-bedroom unit using pressurized walls. The installation and/or construction of a wall without the proper permits from the Department are illegal.
5. "Utilities included" is a red flag. A landlord may not want utilities under another name connected to the property because those residents would violate the legal occupancy of the building.
6. Avoid apartments with odd layouts. They are often described as "unique" or "interesting" and are oddly situated (i.e. a shower installed in the kitchen).
7. Be cautious when a landlord refuses to disclose the exact address. Landlords advertising illegal apartments may ask to meet a potential renter before exposing the address to possible regulation or penalty.
8. Beware of apartments where you can't have mail delivered. Landlords advertising illegal apartments will often request that tenants obtain a separate P.O. Box.
9. Beware of no-lease apartments. Be suspicious of a landlord who declines to draw up a lease, requests a month-to-month agreement or requires cash payments.
10. Check for adequate means of egress and look out for locked doors in the unit. A tenant should be able to access all available exits either directly from the unit or a public hallway.

What kinds of crazy, illegal apartments have you seen along the way? Please share your experiences and sightings on the blog.

More on MoneyWatch:

• Tea Party on Foreclosure: They Bought Houses They Couldn't Afford
• Tea Party: Renters Shouldn't Vote
• Report Shows 2010 Was Record Year for Foreclosures
• Foreclosure Lawsuit Upset: Court Rules Against Wells Fargo and US Bancorp
• FHA's Reverse Mortgage Standards Get Tougher in Response to Increased Delinquency
• Pending Home Sales Up in November, Realtors Provide Economic Forecast for 2011
• Top Remodeling Trends for 2011
• Housing Prices Rebounding Here
• Tea Party: Don't Let Renters Vote
• Are You Getting Screwed by Your Lender?
• Help For Homeowners: 4 Million Homeowners Ask For Help
• Foreclosure Process Shows Mortgage Lending Isn't The Only Problem
• What Does Main Street Know That Wall Street Doesn't?
• Real Estate Crisis Continues - Non-Residential Construction to Fall 20% by End of 2010
• Jobs, Small Businesses, Payrolls, and the Economy
• Loan Modification Hell: New Solutions To Avoid Losing Your Home

Ilyce Glink

Ilyce R. Glink is an award-winning, nationally-syndicated columnist, best-selling book author and founder of Best Money Moves, an employee benefit program that helps reduce financial stress. She also owns ThinkGlink.com, where readers can find real estate and personal finance resources.

Twitter