NYC rents plummet, bringing back deals and fears of a glut
'A month's free rent' returns after many years
Rents for apartments in New York City have been consistently dropping throughout the pandemic, and the trend continued in the first quarter of 2021.
In Brooklyn, in particular, rents fell by 10 percent year-over-year, the largest annual decline the borough has experienced, according to StreetEasy’s market reports.
The median asking rent in Brooklyn was $2,390, the lowest since 2011. And in Queens, the median asking rent was $1,999, dropping below $2,000 for the first time in eight years.
While demand for apartments in Brooklyn might be higher than the levels seen in Manhattan, the lowering of prices means there are still deals to be had, the report said. The median asking rent for a one-bedroom apartment in North Brooklyn, comprising Williamsburg and Greenpoint, was $2,500 — the lowest it’s been in more than 10 years.
In addition to lower rent prices, New York City renters also found a record number of units offering free months of rent — an incentive that was common in the early and mid- 20th century, but that declined with the real estate boom of the past few decades.
In Brooklyn and Queens, 25.4 percent and 26.6 percent of landlords, respectively, advertised a concession of at least one month’s free rent. This was the highest percentage since the firm, founded in 2005, began its real estate surveys.
Even in Manhattan, 44.2 percent of all landlords advertised a concession in the form of at least one month’s rent, also a record-high share.
The number of rental units available was one of the key factors driving the rent drops and surge in concessions. And in the first quarter, rental inventory in Manhattan and Brooklyn was more than twice as high as it was in the first quarter of 2001, and Queens inventory was 97 percent higher. In addition to vacant apartments in existing buildings, new developments are also going on the market.
However, while inventory is above what it was a year ago, the number of available apartments has fallen for the past two quarters, down from the peaks seen during the summer of 2020
Given all of these factors, StreetEasy economist Nancy Wu believes that prices could stay low, while rental activity will pick up more rapidly this summer.
“With the weather getting warmer and more people rolling up their sleeves to get vaccinated, New Yorkers are starting to feel a sense of normalcy. As this continues, the rate that apartments come off the market will continue to ramp up,” said Wu.
“Renters don’t need to rush to sign a new lease this second to claim a great deal, though,” Wu adds. “It will take time for prices to rebound. But the rentals market does react to economic activity much more quickly than the sales market. As the city continues to recover, competition will slowly start to pick up.”
Leave a Comment
Leave a Comment