Manhattan apartment rents see first year-over-year drop since 2021
MANHATTAN rents fell annually in November for the first time since mid-2021, a sign that the apartment market is experiencing more than just seasonal sluggishness.
New leases were signed last month at a median of US$4,000, a 4.6 per cent drop from October, and 2.3 per cent lower than in November 2022, according to appraiser Miller Samuel and brokerage Douglas Elliman Real Estate. It had been 27 months since the previous year-over-year decline.
“This is beyond seasonal,” said Jonathan Miller, president of Miller Samuel. “It’s not a weak market, but it’s weaker than the frenzy of the last couple of years.”
Rents have fallen rapidly over the past three months, sliding 9.1 per cent since hitting a record high of US$4,400 in July and August. While apartment hunters are seeing some relief from the price surge that started as employers began calling workers back to their offices in mid-2021, rents are still 11 per cent higher than they were in November 2019, before the pandemic hit.
Prices slipped as Manhattan’s vacancy rate rose annually for the 14th consecutive month, reaching 2.93 per cent. Miller said that may reflect a boost in inventory as landlords listed more apartments, shifting units out of the Airbnb market to comply with new city restrictions on short-term rentals.
Miller expects more small rent declines over the next few months, but he does not anticipate a sharp correction before costs begin rising moderately again, during the typically more-expensive spring and summer.
Next year, he said, “is all about being incremental”.
In northwest Queens, the section of the borough closest to Manhattan, the median rent receded year over year for the first time in 11 months, falling 0.3 per cent – or US$10 – to US$3,175. While in Brooklyn, rents rose slightly from October, last month’s median of US$3,495 is down nearly 12 per cent from the peak in July. BLOOMBERG
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