Apartment hunting in New York City is, to put it lightly, a miserable, soul-sucking experience. By the time you finish touring units, navigating through a snake pit of brokers and finally settle on a new place, you’re usually required to put up first and last month’s rent plus a security deposit (and often a broker’s fee) in order to sign a lease.
This all means that New York renters are forced to put up thousands of dollars in order to move into a new apartment, and that bar to entry is out of reach for a sizable portion of Gotham’s 8.5 million residents. But a new service aims to make security deposits in the city—and beyond—a thing of the past.
Rhino, which launched in New York on Wednesday, is centered around a simple idea: Lower the down payment required for apartments by charging tenants $10 to $20 per month instead of a hefty security deposit. The company insures both the landlord and the tenant, giving property owners better coverage when a renter does damage a unit and relieving tenants of the often arduous battle of getting their security deposits returned.
The service was founded by tech entrepreneur Ankur Jain under the umbrella of the Kairos Society, a nonprofit that he formed in 2008 with the goal of tackling major world issues through innovation.
“There is over $40 billion tied up in security deposits in the United States,” Jain said over the phone. “And, assuming a landlord doesn’t screw you out of your deposit, you’re just going to pass that money along to your next security deposit.”
Rhino is launching with roughly 23,000 apartments in New York and aims to grow at an ambitious clip. Tenants who already live in buildings that the company covers have the option of getting their security deposit returned and paying a monthly fee. Any tenant can sign up to Rhino and submit the company’s policy to their landlord for consideration. So far, Jain says property owners are pretty receptive.
“We designed this in a way that is attractive to a vast majority of landlords,” he says.
Reducing the up-front cost of renting an apartment could be a game changer for New York City, which has an ever-growing population and an ever-thinning housing supply. Other trends over the past decade like no-fee rentals have lowered the cost of entry, but Rhino’s pitch to remove security deposits altogether is all but unparalleled in the city.
“A half percent of Americans today don’t have $400 for an emergency expense,” Jain said. “Giving them back thousands of dollars is a great way to solve that.”
Granted, Rhino’s fee could make renters end up paying a bit more each year. But a couple hundred dollars a year is a much easier pill to swallow than a several thousand dollar lump sum.