C
olumnist Ross Barkan deserves credit for opposing the industry's position on the broker-fee bill in Crain's New York Business, a publication with a business audience. However, his argument against the bill was flawed. He claimed that broker fees are excessive and unfair, citing a scenario where a tenant was quoted a $3,000 fee to rent an apartment for less than $2,000 in Brooklyn. Barkan argued that this is unacceptable because it's akin to a business forcing consumers to pay for outside consultants.

    However, this analogy doesn't hold up. In the real estate market, broker fees are a common practice and not unique to New York City. Many businesses charge customers for services like shipping or ticketing fees. Governments also impose fees on credit card transactions and electronic payments. Barkan's argument that tenants should be able to negotiate directly with landlords without brokers is also misleading, as many large landlords already offer no-fee rentals.

    The real issue is the lack of affordable housing in New York City, which drives up demand and prices. The City Council's recent legislation, which requires landlords to pay broker fees, has both benefits and drawbacks. On one hand, it makes brokers more accountable to landlords and could lead to lower move-in costs for tenants. On the other hand, it may result in higher rents and reduced incomes for brokers.

    Barkan failed to consider these complexities because he was writing from a tenant-centric perspective rather than an economist's or real estate expert's viewpoint. When delivering hard truths about real estate and politics to a business audience, courage is necessary but not sufficient.