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Manhattan apartment rents slide after exodus empties buildings

Manhattan's rental market is starting to show the damage from a pandemic-fuelled exodus.

[NEW YORK] Manhattan's rental market is starting to show the damage from a pandemic-fuelled exodus.

The borough's apartment-vacancy rate in June rose to the highest on record. Available listings surged 85 per cent from a year earlier to 10,789 - an all-time high for a single month, appraiser Miller Samuel and brokerage Douglas Elliman Real Estate said in a report on Thursday.

All that inventory put a dent in pricing. The median rent slid 6.6 per cent to US$3,242, the first decline in 18 months and the biggest in data going back to October 2011, according to Jonathan Miller, president of Miller Samuel.

"It does give context to the scale of the movement out of Manhattan during the crisis," Mr Miller said in an interview.

Many New Yorkers lost their taste for dense city living while the coronavirus raged, shuttering office buildings and giving people few reasons to stick around. Apartments vacated during the three-month lockdown were heaped onto the market at the end of June, when the state lifted the ban on in-person real estate showings.

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New lease signings jumped 45 per cent last month from May, with 3,171 apartments finding takers, Miller Samuel and Douglas Elliman said.

To get those tenants, landlords had to offer average rent discounts of 2 per cent, more than double what they were giving last year. They also piled on sweeteners, such as free months and payment of broker fees, in 45 per cent of deals.

Still, the vacancy rate climbed to 3.67 per cent, a record in data going back to August 2006. The rate had never before topped 3 per cent, according to Mr Miller.

"We're in for a summer season that is going to be all about supply," he said.


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