Looking To Rent A One-Bedroom In Manhattan This Summer? Good Luck
Manhattan’s rental market is as hot as the weather, according to new data from the month of July.
Brokerage Douglas Elliman found that the average rent price in the borough was $4,011 last month. Though that’s a mere 2% increase from both the month prior and July 2017, Gotham’s rents are the second-highest in the country, according to Apartment List.
The site found that the median rent price for one-bedrooms in New York is $2,108, topped only by San Francisco, where it stands at $2,458. Demand is particularly high for studios and one-bedrooms in Manhattan, Douglas Elliman confirmed.
While the average price for apartments with three and more bedrooms decreased by 5.9% from July 2017 to last month, it remained mostly stagnant for the city’s smaller digs. This indicates that landlords are having more trouble filling larger apartments, explained Jonathan Miller of the firm Miller Samuel, which compiles Douglas Elliman’s market reports.
Though Miller said studios and one-bedrooms take up nearly 63% of Manhattan’s rental market, the new developments that have shot up around the city while the economy recovers from the 2008 recession have mostly larger units.
“The lower half [of the market] is static so that’s where the pressure is,” Miller said.
Brokerage Citi Habitats, meanwhile, found that Manhattan’s rent prices might be a bit too high across the board. The firm reported that Manhattan’s vacancy rate rose from 1.32% in June to 1.34% last month. That’s down from 1.84% in July 2017, but the firm’s president Gary Malin said the slight month-to-month increase indicates a possible miscalculation from landlords.
Unlike Douglas Elliman, Citi Habitats numbers show that rent prices rose in every apartment size so far this season. For example, the average cost of a one-bedroom in Manhattan went from $3,184 in June to $3,260 last month.
At the same time, concessions—when landlords offer deals to entice tenants such as a free month’s rent or a waived broker fee—went from being offered with 27% of new rental leases in June to 25% last month, the company found. This shows that property owners are confident enough in Manhattan’s notoriously busy summer rental market to raise prices and offer fewer concessions, but tenants have noticed the changes, Malin explained.
“These owners decided, ‘Look, I’m willing to take a little bit of a risk,’” he said. But it may be backfiring: “The circumstances really haven’t gotten to the point where there’s free-flowing income in [renters’] pockets and they’re very sensitive [to price changes.]”