New York renters are fed up with roommates and are increasingly shelling out big bucks to live without them.
Demand for studios and one-bedroom apartments outpaced demand for larger apartments, and their asking rents rose 18 percent year-over-year to $3,000 last month, according to a report from StreetEasy.
The expense of going solo is not only about dollars but also choice of apartment.
“The opportunity cost of privacy is very substantial,” said Kenny Lee, economist at StreetEasy. “Compared to January 2021…renters have less than half the options to choose from when looking for their own space.”
The desire for solitude could hardly have come at a tougher time for tenants, as rents hit all-time highs this summer and have only come down slightly since. Prices likely won’t see a sharp fall this winter, in part because of the increase in solitary renters and demand from buyers priced out of the for-sale market by interest rate hikes, according to StreetEasy.
Normally, when prices go up, tenants pile together to split the cost. But not so much in the wake of Covid-19.
The cost of independence can run tenants $15,000 to $20,300 a year, depending on how many roommates they would have shacked up with.
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Adjina Dekidjiev, a broker with Coldwell Banker Warburg, has noticed the trend.
“I’m seeing people want to live alone and also they’re looking for larger apartments,” she said. “People are more willing to spend more on rent right now and change their lifestyle a bit to get a bigger, better apartment with more amenities.”
Dekidjiev said tenants are looking for more space in part to work from home more comfortably and are sacrificing other activities, such as travel, to afford a better apartment, particularly ones in buildings with a gym and roof deck.
“They’re changing their lifestyle,” she said. “They’re cutting back on other things.”
There is a silver lining for tenants: Rent concessions are rising, StreetEasy reported. In October, the share of listings citywide that received a price cut rose to 18.5 percent, the highest since the height of the pandemic.
“I would emphasize that renters should still expect a bumpy road ahead due to limited inventory of rental units,” Lee said.