As Manhattan apartments got expensive, renters moved to Brooklyn as an alternative — and in doing so, narrowed the price gap between the two boroughs over the years.
The pandemic has accelerated that trend. The gap between median rent in Manhattan and Brooklyn shrank to $171 in November 2020, the New York Times reported, citing data from appraisal firm Miller Samuel. That’s the smallest gap since the firm began tracking in 2008.
It’s almost a flipping of the script for the boroughs. In February 2009, the median rent in Brooklyn was $1,495 cheaper than across the East River. The difference fell to $210 in February 2014, but Manhattan’s condo boom changed that.
As buyers picked up shiny new units as investment properties, they listed them on the rental market for exuberant prices. “A lot of $10,000 to $20,000 rental units … skewed Manhattan rents higher,” Miller told the Times. That left Manhattan median rents $777 higher, although the effect faded as the luxury market softened. By 2019, the gap had fallen to $534.
Then, as Manhattanites fled the pandemic-stricken borough in a quest for more indoor and outdoor space last year, vacancies brought prices in the borough down. Though the difference between Manhattan and Brooklyn rents has grown since November, it’s difficult to predict what’s to come as the New York City exodus becomes an influx again.
“Since the fall, both boroughs have been seeing unusually heavy lease-signing activity,” said Jonathan Miller of Miller Samuel, “which is a baby step in prices beginning to stabilize.”
[NYT] — Danielle Balbi