The typical monthly rent for a Manhattan apartment surpassed $5,000 for the primary time — and brokers say demand and costs are headed even higher into the autumn.
The typical apartment rent in June was $5,058, the very best on record, in keeping with a report from Miller Samuel and Douglas Elliman. Average rental prices were up 29% over last 12 months, while median rent was up by 25% to $4,050 a month.
Except for pricing out many renters, the increases could have knock-on effects amid broader inflation pressures. Rents are a key component of the federal government’s consumer price index, which increased 9.1% from a 12 months ago in June, and Recent York is the nation’s largest rental market.
The continued price pressure in Manhattan rentals could add to higher inflation within the months ahead, and put more pressure on the Federal Reserve to boost rates in an try and tame prices.
“There aren’t any signs of a slowdown, at the very least not yet,” said Jonathan Miller, CEO of Miller Samuel.
A Chelsea Tower rental apartments billboard.
Jeff Greenberg | Getty Images
Miller said higher mortgage rates and fears of a housing downturn are driving more potential buyers into the rental market.
At the identical time, the provision of Manhattan apartments available for rent, which ballooned through the pandemic, is now near record lows. The emptiness rate at the tip of June was just 1.9%, with about 6,400 apartments available — down 46% from last 12 months.
Brokers say many families and renters who left town through the pandemic at the moment are returning, despite concerns about high crime, taxes and troubled subways. Younger renters are also pouring into the rental market. Millennials and even some members of the Gen Z demographic are coming to town after college or working remotely from high-rise rentals to reap the benefits of town’s culture and nightlife.
“At the tip of the day, they need to be in Recent York,” said Valirjana Gashi, a broker at Serhant. “Even among the families that went to Miami are coming back.”
July and August are typically the most important rental months in Manhattan as tenants search for September start dates ahead of a return to high school and work. Brokers say that while open houses for sales listings are almost empty, open houses for rentals have never been more crowded.
“When a great rental comes in the marketplace, especially downtown, there are lines down the block,” Gashi said.
Bidding wars at the moment are routine for rentals. Gashi said considered one of her clients is taking a look at a one-bedroom downtown that is listed at $6,000 a month — up from $5,000 a month last 12 months. The client is offering $6,750 to try to stave off rival bidders.
She also has a client who plans to eventually buy in Manhattan but is renting within the meantime, with a budget of over $30,000 a month.
“He’s willing to spend on the rental because when the time is true to purchase, he hopes to save lots of much more on the acquisition,” she said. “He thinks sale prices are about to return way down.”