Manhattan’s record-high rents, which are isolated from the still uneven economy, are driving several significant changes in the market, according to the New York Times. Brokers say more young people are sharing apartments, and even sacrificing a living room in the process, in order to ease the burden of rising rents. Other renters, who in the past would only consider Manhattan, are being drawn to the outer boroughs. Big landlords in the boroughs, like LeFrak Organization, report all-time high rents as a result of that demand.
Finally, some would-be renters that can secure a loan are diving into the sales market, rather than paying higher rents or shelling out a broker’s fee and other moving costs to find a better deal.
But for renters unable to secure that loan, there’s little end in sight for the surging prices. Citi Habitats President Gary Malin told the Times, unless another major financial catastrophe hits, rents would stop rising only when the supply begins ascending. But just 2,229 rental apartments are scheduled to be added in Manhattan this year, a 30 percent drop from the average number over the previous seven years. [NYT]