With Manhattan rents continuing to rise, Brooklyn and Queens experienced a surge of new rentals during the month of July, according to Douglas Elliman’s monthly rental report.
In Manhattan, the median rental price last month rose 5.4 percent to $3,205, its highest July level in six years, according to the report, which was released today.
“Anyone who is looking for an apartment is really not getting a deal,” said Luciane Serifovic, executive vice president of rentals for Douglas Elliman. In Queens and Brooklyn, she said, “Tenants are pushing back and seeking apartments elsewhere because probably they have more opportunities with some of the new development buildings.”
In Manhattan, the average rental price in July was $4,022, a 5.2 percent increase from the prior year period. Meanwhile, the number of new rentals increased 7.2 percent to 4,938, a reflection of the busy summer season. And the vacancy rate dropped to 1.82 percent – the lowest July vacancy rate in five years – while the listing inventory dropped 4.4 percent to 5,690 available units.
Not surprisingly, the percentage of rentals with landlord concessions was “nominal,” falling 1.6 percent, the lowest in two years, said Jonathan Miller, president of Miller Samuel and the author of the Douglas Elliman report.
In Brooklyn and Queens, median rents also continued to climb.
Brooklyn’s rental prices in July were just $353 lower than Manhattan, down from $500 in June, and the median rental price rose 6.6 percent to $2,852.
But the number of new Brooklyn rentals skyrocketed 127 percent to 892 – a reflection of tenant’s resisting the price increases sought by landlords at the time of renewal.
Miller said the uptick in new rentals was bolstered by new developments. Developments in Brooklyn and Queens tend to be rental buildings, while they tend to be condos in Manhattan, he said.
In Queens, new rentals surged 136 percent to 203, and in particular, they did so in new development buildings. One out of four new rentals was located in a new building, according to the report. Overall, Queens’ median rental prices rose 10.5 percent to $2,646.
Miller said the jump in Queens rentals is a byproduct of rising prices in Manhattan and Queens. “People in the city are looking for greater affordability,” he said.
With the exception of apartments with three or more bedrooms, studios experienced the highest year-over-year price increases.
In Manhattan, the average rental price for studios was $2,573, up 7.1 percent from July 2013, while the average rent for one-bedrooms was $3,349, up 4.3 percent. Two-bedrooms average rents were about flat at $4,817. Meanwhile, apartments with three bedrooms and up averaged $8,554, up 11.6 percent from $7,666.
Citi Habitats, in a report also released Thursday, noted that average rents in Manhattan had come to an “abrupt halt.” The average apartment rented for $3,465 in July, $5 less than June 2014. Year over year, the average rent in July was still higher than a year earlier, when it was $3,442.
Citi Habitats’ President Gary Malin said the leveling off of rental prices in July was a function of landlords pushing prices too high at the end of last year, and subsequently racking up vacancies. “If you force tenants to be industrious and look for other opportunities, they will go do that,” he said.
In a comparison of prices by neighborhood, the Citi Habitats report found that the most expensive neighborhood for renters was SoHo/Tribeca, with a median rent of $5,300, followed by the Financial District/Battery Park City, with a median rent of $3,600. The least expensive neighborhood was Washington Heights, with a median rent of $1,980.
Brokerage MNS, which also released a report Thursday, found that Harlem experienced the largest increase in listing inventory in July, with 226 new units coming to market, a 64.6 percent increase from June. Midtown East saw the greatest decrease, 50.5 percent, with 440 units coming off the market.
When it came to building type, the highest availability – 53 percent – was in doorman buildings, according to the July rental report published by Coldwell Banker AC Lawrence. Availability in elevator buildings followed, with 24 percent availability, and then walkups, with 23 percent availability.