Rents on the rise as competition intensifies in New York City
Apartment hunters in Manhattan faced fierce competition in January as leasing activity surged and rents experienced their first year-over-year increase since October.
Data from the latest Elliman Report revealed that the median price on new leases reached $4,150, a 1.3% increase from January 2023 and a $100 uptick from December. Additionally, 3,922 rental agreements were signed in January, up 14% year over year, marking the third consecutive annual increase.
New Yorkers have been capitalizing on the downward trend in apartment costs observed since the summer’s peak, driving significant demand even in the typically slower winter months.
This heightened demand has contributed to upward pressure on rents, defying expectations of a leveling off. Although Manhattan’s median rent remains below the record high of $4,440 in July, it still exceeds pre-pandemic levels.
Jonathan Miller, president of Miller Samuel, noted, “The median rent is not pushing the thresholds that it once was, and that’s helped attract more activity.” He added, “It’s not as if rents are falling steadily, but they’re drifting lower. They’re off from the summer records, but we’re still seeing some elements of pricing still high.”
Despite an increase in listing inventory — with 7,496 apartments available at the end of January, marking an 18% rise from the previous year — inventory levels remain historically low.
Miller suggested that rent declines may be on the horizon as mortgage rates decrease, potentially incentivizing more individuals to transition to homeownership and alleviating competition for rentals.
Beyond Manhattan, the outer boroughs are experiencing robust demand as well. Brooklyn saw nearly double the number of new leases compared to the previous year, with the median rent holding steady at $3,500. In northwest Queens, lease signings surged 31% year-over-year, while the median rent dipped 5% to $3,200. Despite this, listing inventory decreased in both boroughs.
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