Manhattan rental rates edged up in March for the first time in six months as landlords moved to bolster occupancy with an increased number of concessions, according to Yuval Greenblatt, executive vice president of Douglas Elliman.
The median rent for a Manhattan apartment edged up 0.2 percent to $3,200 per month in March, up from $3,195 in the same period of 2013, according to Douglas Elliman’s monthly rental market report released today
“In Manhattan, this was the first month rent didn’t slip since August, because we’re getting now closer to the true rental season,” Greenblatt told The Real Deal. “It looks like we had a weaker off-season last year, but the trend was clearly reversed in Manhattan in March.”
Although the average landlord concession was roughly the equivalent of one month’s rent in March, the use of concessions increased to 9.4 percent of all lease deals, up from 4.6 percent in the same period last year, the Elliman report said.
“The majority of the landlords in Manhattan are major, professional landlords who sometimes prefer to buy occupancy via increased concessions,” Greenblatt said. “It’s one way landlords intelligently deal with their inventory – they do that to get ahead of vacancies. And it’s clearly worked because you see median rents stopped declining and listing inventory was pretty flat year-over-year.”
Studio units saw the biggest price increase, with the median rent rising 2.5 percent to $2,401 from $2,342 in March 2013. Rents for one-bedrooms ticked up 1.6 percent year-over-year to $3,250 from $3,200 — but the monthly median rate tumbled for both two- and three-bedrooms. Two-bedroom rentals went for a median price of $4,650, down 2.1 percent from $4,750 in March of last year, while three-bedroom rentals slipped 4.7 percent to $7,100 from $7,450.
The Manhattan rental vacancy rate hit 1.46 percent in March, down from 1.50 percent the previous month and exactly the same as the rate in March 2013, according to Citi Habitats’ rental market report released today.
“The cost of renting for the tenant has changed dramatically, but incomes aren’t rising in the same proportions,” Gary Malin, president of Citi Habitats, told The Real Deal. “So it gets to a level where prices are strong and that leads to deals, but they can’t be pushed any further without having an impact on vacancy rates.”
The average Manhattan renter paid 0.4 percent less for an apartment in March than in February, the Citi Habitats report said.
In Brooklyn, listing inventory skyrocketed, jumping 72.4 percent to 1,495 listings from 867 in the same period last year. The median rent there in March was $2,900 – up 13.3 percent year-over-year, according to Elliman.
Brooklyn’s priciest pads were two-bedrooms in Dumbo, which had a mean rental price of $5,281 per month, while the cheapest were studios in Bay Ridge, with a mean of $1,200 per month, according to MNS’ March rental market report.