The Real Deal New York

Brooklyn rents hit new peak, Manhattan pushes higher

Improving economy, rising employment and tight credit kept the pressure on: Elliman

May 14, 2015 08:00AM
By Tess Hofmann

(credit: Douglas Elliman and Miller Samuel)

(credit: Douglas Elliman and Miller Samuel)

Median rents climbed for the fourteenth consecutive month in Manhattan in April, while in Brooklyn, they reached their highest point since Douglas Elliman began collecting data for the borough, according to the brokerage’s latest rental market report.

After two months of small declines, the Brooklyn median rent rose 5.6 percent to $2,961, while the average rent slipped 0.3 percent to $3,220.

“What happened with that was we had a period of growth in year-over-year rents, and then the last couple of months rents have started to level out in Brooklyn and we saw a little bit of a decline the last two months, but really still just shy of record levels,” said Jonathan Miller, president of real estate appraisal firm Miller Samuel and the author of the Elliman report. “Then this month it resumed climbing and broke the ceiling, so to speak.”

In Manhattan, the median rent rose 3.5 percent to $3,361, and the average increased 1.1 percent to $4,054. This is the third consecutive month where the average rent in Manhattan eclipsed $4,000, according to the report.

(credit: Douglas Elliman and Miller Samuel)

(credit: Douglas Elliman and Miller Samuel)

The borough also saw median prices increase across all size categories, while in Brooklyn, median prices climbed for studios through two-bedrooms, but dropped 5 percent year-over-year for three-bedrooms.

It’s almost a “lather, rinse, repeat” cycle, Miller said, with rents buoyed by an improving economy and tight credit. Prices will continue to surge the most for smaller apartments, he said, that are likely to be rented by would-be first-time buyers unable to find financing.

In Manhattan, the listing inventory remained stable, dipping just 0.3 percent to 5,485, while in Brooklyn, the inventory slipped significantly from last year, falling 27.5 percent to 1,038.

In Queens, the median rent fell 5 percent from last year to $2,768, but Miller said that in general, rents are on the rise in the borough, and the discrepancy this month was due to a temporary influx of lower-priced rentals in a market chock-full of new development.

A rental report by Citi Habitats, also released today, found that the most expensive Manhattan neighborhood south of 96th Street for renters was Soho/Tribeca, with a median rent of $4,195, while the least expensive south of 96th Street was the Upper East Side, with a median of $2,375. What would Jackie O say?