The pace of rent growth in Brooklyn continues to outshine that of Manhattan, although rents in both boroughs remain at record highs, according to July reports from leading brokerages released today.
There is “a continued upward increase in both markets; clearly Brooklyn is seeing greater upward pressure,” said Jonathan Miller, CEO of real estate data firm Miller Samuel and author of Douglas Elliman’s report.
“Manhattan, for the last five months, actually has seen a declining pace of growth but has shown, for the 25th consecutive month, no decline in rent,” Miller said.
The median rent in Manhattan increased 1.1 percent, to $3,042 from $3,008 per month, year-over-year, Elliman’s reports says. In Brooklyn, the median rent was $2,675 in July, up 5.1 percent from last July’s median figure of $2,546, but down slightly from that of June 2013, when median rents in the borough of Kings were 2.3 percent higher, at $2,737 per month.
“I’d call it a stalemate,” said Gary Malin, president of Citi Habitats, whose firm also released a report today. “Owners try to push, but there is really nowhere to push.”
The average rent of a Manhattan apartment was $3,442 in July, Citi Habitats’ figures show, or $18 more than in June 2013, when the average was $3,424, an increase of 0.5 percent. However, average rents are still down slightly, about $17 per month, from 12 months ago, when the average apartment rented for $3,459.
The vacancy rate for July was 1.28 percent, up from June’s rate of 1.1 percent and a slight increase from the year-over-year vacancy rate of 1.2 percent, Citi Habitats’ research says.
Dismal jobs numbers are the main factor preventing Manhattan renters from trading up, Malin said.
“A lot of people are … not moving, even if they’d like to,” he said.
The result is a market full of miserable participants.
“What you are seeing is two unhappy parties,” Miller said. “Landlords cannot press rents higher. … Tenants are still feeling the pressure.”