NYC Bucks National Trend, Climbs Toward Record

Rents are softening across the country. But New York City is not the rest of the country.

Rent in the city stayed elevated in October despite expected seasonal trends and cooling mortgage rates. Median rent for a new, brokered, market-rate lease in Manhattan was $4,600 in October, according to a monthly report from appraisal firm Miller Samuel for Douglas Elliman.

That was a $50 increase from September, but a 7 percent increase year-over-year.

Although rents have come down across the country, New York City rents have been buoyed by a strong local economy, said report author Jonathan Miller.

Rents that rise faster than inflation may be good for landlords who are seeing expenses grow. But elevated rents have also contributed to affordability concerns, a cornerstone of Mayor-elect Zohran Mamdani’s successful campaign.

“Rents are still growing at more than twice the rate of inflation,” Miller said. “That encapsulates the affordability crisis in housing perfectly.”

Manhattan’s median rent reached a record in February and remained high through the summer, climbing to a $4,700 peak in July. That was likely in part due to elevated mortgage rates keeping would-be buyers in the rental market, Miller said.

The trend has been similar in Brooklyn and Northwest Queens. Median rents for a new, brokered, market-rate lease in those areas reached $3,850 and $3,598 in October, respectively. Median rents grew by 6.9 percent year-over-year in Brooklyn and 7.4 percent year-over-year in Northwest Queens.

Although median rents usually fall in the city with cooler weather and flagging demand, that hasn’t quite come to pass. October matched August’s median for the third-highest Manhattan rent on record. Nearly 18 percent of Manhattan leases were signed after a bidding war, up a percentage point from a year ago.

That’s in contrast to the national trend. Rising unemployment and moderating wage growth are contributing to softer demand. GDP has grown, but largely driven by AI-related capital expenditures, according to a report from JPMorgan. Add in the rise of development seen in the last few years, and you have a recipe for lower rents.

But the Big Apple has fared better. The securities industry, which powers a good portion of the city’s economy, continues to bring in record profits, according to the state comptroller’s office. That may be contributing to a sharp rise in prices for Manhattan’s luxury market: The top decile of listings has seen median rents rise 20 percent since last October, coming to $11,995.

With the election in the books and Mamdani headed to Gracie Mansion, some uncertainty has been eliminated from the housing market, Miller said. Mamdani made promoting affordability for renters a key part of his mayoral campaign and has pledged to use his sway over the Rent Guidelines Board to freeze prices in rent-stabilized apartments, nearly half of the city housing stock.

Although that would increase affordability for those tenants, it would also likely lead to accelerated rent growth in market-rate apartments, Miller said. Landlords, who are facing steep inflation in their expenses, will attempt to make up the difference in net income on any market-rate units they own.

“We’re still looking at upward pressure in rents going forward,” Miller said, “no matter how the economy performs.”