Large cities are seeing fierce competition, long lines in often freezing weather, and hard-fought bidding wars for rental units.
Renters Flooding Rental Markets
Many renters who fled “the big city” two years ago are returning. Those who chose to remain as renters in cities are looking for more space or an extra room to use as an office.
The search for more space and more amenities has translated into record-high rents. The reality for apartment and/or single-family home rental hunters is one that homebuyers know well…bidding wars.
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Ava Howard, an agent with Berkshire Hathaway HomeServices, said, “the rental market is just on a different type of scale right now in terms of how quick paced it is. It’s all about who’s fastest and who’s willing to pay the most. It’s like buying a home right now. It’s so competitive.”
New York City’s Rental Markets
Corcoran broker Tiga McLoyd said, “A year ago today, everything was in the renter’s favor. Now, it’s the exact opposite.”
New leasing volume has dipped below the decade average as listing inventory has evaporated and rent prices have reached record levels.
Check out data that shows the year-over-year percentage changes from Miller Samuel and Douglas Elliman Real Estate:
- Studios: median rental prices up +20%; new leases down -47%
- 1-Beds: median rental prices up +18%; new leases down -49%
- 2-Beds: median rental prices up +17%; new leases down – 49%
- 3-Beds – median rental prices up +12%; new leases down-45%
In January, the supply of available for-rent apartments in Manhattan plunged -83% y/y, according to Douglas Elliman Real Estate. Median rent jumped +18.3% to $3,550.
Brooklyn has seen its rental inventory plunge -86.4% y/y, the biggest drop rate on record. Simultaneously, in Northwest Queens, across the East River from Manhattan, tanked -90.6% y/y.
Huge Demand for Larger Spaces
Apartments and houses that include outdoor space, good lighting, large rooms, extra space for home offices and renovated amenities are flying off the shelves.
One 1,500 square-foot, three-bedroom brownstone in Prospect Heights stimulated a hard-fought bidding war that pushed up the original price of $7,250/month by approximately +20%. A townhouse in Brooklyn, originally listed for $7,200/month, generated a winning bid of $7,500 because of its large size, big bedrooms that fit king-sized beds, cool kitchen, cool living room and convenient location.
One apartment hunter in Williamsburg, a trendy Brooklyn location, said, “The process of finding a place here is like buying a million-dollar house somewhere, which is crazy.”
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