Calling real estate in New York City is redundant, but due to the pandemic and ensuing flight to the suburbs, rents are trending lower, and the deals are getting better.
Apartment listing site StreetEasy reported that the median asking rent in New York City in the third quarter dipped below $3,000 for the first time since 2011, and the number of listings that were discounted surged to a record high of 44.7% as landlords struggled to find tenants. Not only were there many more discounts, but the size of discounts increased, with the median discount reaching 9.1% off the asking rent, more than double the median discount of last year.
Whereas it used to be difficult to find an apartment, the listing site shows that rental inventory increased just at 70%, up almost 30,000 from this time last year.
And it’s not just in Manhattan. The share of discounted rentals in Brooklyn and Queens reached 30.7% and 26.6%, respectively.
The third quarter was the first time in a decade when the median rent dropped in all three boroughs over the previous year.
StreetEasy Economist Nancy Wu said:
“Renters are no longer willing to pay the commute premium of living in Manhattan when they do not need to commute to an office five days a week. Landlords across the city, but particularly in Manhattan, have to be willing to face some really hard hits if they want to fill their units. They’re being forced to cut the location premium out of their asking price in order to compete with larger and more affordable apartments in the outer boroughs.”
The city faces a difficult task as it tries to fill a $9 billion budget hole while the population dwindles.