As reported by real estate firm Douglas Elliman and appraiser Miller Samuel, for the first time Borough’s vacancy rate exceeded 5%. This was the highest level in the report’s 14-year history, during which Manhattan’s vacancy rate has risen between 1.5% and 2.5%. In the last four months, the rate has registered a steady and rapid growth which is a record every month.
Jonathan Samuel, president of Miller Samuel, said, “In Manhattan, because of Kovid, tenants want to move to the Outer Borough for their rental dollars.” Others will be tenants in Manhattan [now] First time buyer in the suburbs. ”
As a result, 24% fewer leases were signed in August than a year earlier, with a 166% increase in rent lists available. And the average rent for all apartments was $ 3,363 per month, 4% less than a year ago.
Miller said the virus has questioned the high cost of living in Manhattan.
“Over the years, we have crossed the economical threshold,” Miller said. “With the loss of the ability to comfortably use all the amenities that characterize living in a city – restaurants, retail, bars, all cultural events that were in your dock and as residents of Manhattan say – people question it Are picking up. They were salivating on strength. ”
Big fare cuts in low price categories
As vacancies increase and rents decline, part of the apartments are offered with incentives – such as no broker’s fees, or one or two months’ rent included – increasing. More than half of the new leases signed in August included a landlord’s concession, the largest share of concessions in a decade of tracking.
The amount of free rent paid by landlords increased 60% in August from the previous year, increasing from 1.2 months to 1.9 months.
While all rent levels were seen to decline, the most significant reductions in fares were in the lower price range, Miller said.
The average rent for luxury apartments, or apartments in the top 10% of the price, was $ 7,995 in August, down only 0.1% from the previous year. At an all-time low, with an average rent of $ 2,250, the biggest drop from the previous year saw a 6.3% decrease.
More property is available, leading to stronger concessions, he said.
“During Kovid, we are seeing that the picture of unemployment is skewed towards the strong workers,” he said. “That market is nowhere near as tight as it was.”
Brooklyn outperforming Manhattan
Meanwhile, Brooklyn’s bore looks a little better.
Brooklyn’s average rent of $ 2,995 is 1% lower than last year. The number of new leases is down 2.2%.
“Brooklyn, even though it is weaker than it was a year ago, has not seen levels of deterioration near Manhattan,” Miller.
But the listing listing in August doubled from its pre-year level, despite a slight drop in the number of new leases. And 43% of new leases came with concessions.
“Manhattan people are seeing Brooklyn in space and rents are softening everywhere,” he said.
But space is still at a premium. Brooklyn and Manhattan both have at least one type of apartment for which rents are going up: two-bedrooms.
In Brooklyn, two-bedroom, average rent of $ 3,447, increased 4.5% from a year earlier. The $ 4,379 rent for a two-bedroom apartment in Manhattan is 7.4% higher than last year.
“Some people will see the opportunity,” he said. “We are seeing people doing business.”