A year into the pandemic, New York renters are taking advantage of falling prices, high vacancy rates and a massive number of apartments on the market.
Leasing in Manhattan and Brooklyn last month was at the highest level in 13 years, according to Douglas Elliman’s monthly rental market report. Some version of that story has been playing out every month since October as rents continue to slide and thousands of apartments remain on the market.
Appraiser Jonathan Miller, who’s behind the report, noted the trend is particularly pronounced in Manhattan where 6,561 deals were inked last month compared to 3,089 in February 2020 — the largest year-over-year gain of any period since 2011.
“The theme is that the activity is accelerating rapidly,” he said, noting that even older inventory that’s been languishing on the market is starting to get rented. “All of the other metrics are still showing very weak conditions but are slowly improving.”
In Manhattan, there are 11,750 apartments for rent, up 154 percent from February 2020. But that’s an improvement from October, when listed inventory hit its peak with more than 16,000 units on the market.
It’s possible that that figure represents only a fraction of what’s truly available, as some landlords are opting to warehouse units to wait for more favorable market conditions, as the Wall Street Journal reported.
Median rent in Manhattan continued to fall to $2,995 per month, down 14.4 percent year-over-year. Once concessions — averaging 2.1 months of free rent for more than 40 percent of the market — are factored in, the median rent drops to $2,843.
The borough’s vacancy rate remains elevated at 5 percent, compared to last year’s pre-pandemic 2.01 percent.
In Brooklyn, 1,834 new leases were signed last month, up about 133 percent from 788 deals a year ago. Inventory remained bloated, with 3,438 apartments for rent, up 150 percent year-over-year from 1,375 units last year.
Median rent in the borough was $2,625 per month, down 15 percent from $3,100 in February 2020. The average concession was 1.7 months of free rent, with 38 percent of leases including some sweetener for tenants.
In northwest Queens, the same trends continued, albeit to a lesser degree. Inventory was 64 percent greater last month, with 560 units for rent compared to 341 a year earlier. Median rent dropped 13 percent to $2,522 per month from $2,900 last year. The average concession was 2.3 months of free rent.
Hal Gavzie, head of leasing at Douglas Elliman, said the fifth month of increased leasing activity indicates the city’s depressed rental market may be stabilizing, particularly as vaccination efforts are expected to ramp up this spring.
But he cautioned that recovery in terms of pricing would not be instantaneous.
“This is not a light switch,” he said, estimating that it could take between 18 to 24 months for rents to climb back to pre-pandemic levels, assuming vaccination plans move forward as anticipated.
“The next four months are going to be very telling,” said Gavzie.