Manhattan apartment rents dip in May

Manhattan apartment rents saw an unexpected dip in May, marking a “sideways” trend as the market enters its typically busy season.

New leases averaged $4,250, a 3.3 per cent drop from last year, though still the second-highest for May and unchanged from April. Spring usually brings rent hikes in preparation for the peak months of July and August, but since late 2023, rents have lingered below the record high of $4,400.

Jonathan Miller of Miller Samuel noted the market’s stagnant movement: “Prices are moving sideways,” he said. Leasing activity surged in May with 7,085 new leases, up almost 41 per cent from last year, but increased listing inventory helped maintain stable prices.

Miller suggests landlords demanding high renewal prices may push tenants into the market. Additionally, with May’s mortgage rates near 7 per cent, some potential buyers opted to rent instead. Miller predicts this rental trend will continue through summer unless the Federal Reserve adjusts interest rates earlier than expected.

While Manhattan may see slightly higher rents by September, Miller doesn’t foresee drastic changes.

Meanwhile, Brooklyn experienced a surge in activity with a 161 per cent increase in lease signings compared to last year, hitting a record high of 4,341 leases with a median rent of $3,600. New signings in Queens, including Long Island City and Astoria, reached a record high of 811, up 113 per cent from last year, with median rents at $3,400, a slight decrease.

Attribution: Bloomberg