December isn’t typically a busy month for the rental market, but nothing about 2020 was typical — and New Yorkers signed leases in record numbers as the year came to a close.
The number of new rental deals inked last month in Manhattan and Brooklyn hit levels not seen in 12 years, according to Douglas Elliman’s monthly report. It’s the third month in a row that leasing activity has set annual records.
There were 5,459 new leases signed in Manhattan in December, up about 94 percent from the same time last year, and up 36 percent from the 4,015 leases inked in November.
Appraiser Jonathan Miller of Miller Samuel, the report’s author, said that uptick in leasing was “encouraging.” He attributed the end-of-year surge to low prices luring new residents, or existing tenants moving to get a better deal.
“But all the other metrics are still extremely weak,” he said. “It’s not a recovery.… [But] this is the first thing that should happen as we move to recovery.”
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More than half of the Manhattan deals came with some kind of concession, and rents continued to tumble.
The net effective median rent (or the amount with concessions factored in) fell 14 percent year-over-year to $2,996, from $3,499 in December 2019. That’s the second-largest drop in the borough in nine years; the largest happened in November, when rents sank about 22 percent.
As a result of the rise in leasing activity, Manhattan’s vacancy rate shrunk to 5.52 percent, down from 6.14 percent in November. But December’s rate was the third-highest on record.
Brooklyn experienced a similar surge in activity, with new leases jumping 59 percent to 1,291, compared to 811 deals last December. But the borough’s median rent fell nearly 10 percent to $2,700, from $2,991 last year. That’s a 3 percent slide from November’s median rent of $2,786.
Landlords offering concessions accounted for nearly half of the market, with 48.5 percent of new leases being offered with sweeteners for tenants.
In northwest Queens, new lease signings were up about 34 percent year-over-year with 269 deals inked last month, compared to 201 a year earlier. Of those deals, 62 percent came with concessions, compared to 54 percent last year. Median rents in the area dropped to $2,400, down 14 percent year-over-year from $2,795.