The red-hot Manhattan apartment rental market continues to get even more challenging for tenants as average rents soar to another record high, according to Bloomberg, citing a new report from appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate.
Tenants paid an average rent price of $3,644 on new leases signed in March. Rents have soared 23% from a year earlier and are up $14 from the previous record high recorded in February.
A year ago, Manhattan apartment rents slumped as an exodus of urbanites from the borough fled to the countryside, cheaper communities, or even tax-haven Florida. However, since last spring, rental demand has surged. In March, about 20% of rents were signed at a 9.7% premium to their asking prices, suggesting a bidding war continues.
Even with most white-collar NYC workers still out of the office and remotely working or on some hybrid work schedule, people continue to flood the borough.
Landlords have had the upper hand in negotiating as the vacancy rate remained below 2% for a fourth consecutive month. In 2019, vacancies were around 2% but jumped to 10% after the pandemic.
"There's a fair amount of growth in front of us, this is not a peak yet," Jonathan Miller, president of Miller Samuel said.
"Right now, it's ramping up into the spring and summer, and I would suspect we're going to continue atypical rent growth until then," Miller continued.
A separate report by real estate firm Corcoran Group noted that inventory is rising. However, they said listings are significantly down compared with last year.
Corcoran said last month that a shortfall of new apartment buildings in the borough could add to tighter inventory and further boost prices.