NYC’S RENTALS: STATE OF THE MARKET
With many New Yorkers either temporarily or permanently moving outside of the city because of the COVID-19 pandemic, the rental inventory in the five boroughs is soaring. With 40,971 units on the market in Manhattan, 25,581 in Brooklyn and 7,348 in Queens (per StreetEasy as of September 28, 2020), landlords are being forced to offer their spaces for rent at much lower rates than in years past.
For renters, this means depending on the flexibility or expiration date of their current lease, they may be able to move around a bit and upgrade to a space that was out of their price range in years prior. We see Manhattan renters living in non-doorman buildings on the far east- or west- sides moving into full-service buildings within closer proximity to transportation hubs. Furthermore, realizing they may be able to secure a larger space with private outdoor areas in other boroughs, we see Manhattan renters optimizing their dollar and moving to Brooklyn. Brooklyn renters have become more flexible, too. Those living in say, North Brooklyn, might move across the Queens border and into Long Island City, Ridgewood, Sunnyside, or Astoria in search of larger living spaces at lower costs.
Renters with some negotiation savvy, too, are coming into higher priced apartments and offering a base rent much lower than the price listed and requesting concessions like free rent and owner-paid fees. The savvy owner has a broker privy to what the market really holds in the area and therefore able to negotiate soundly on their behalf.
The other piece we must consider when listing rentals is that vacancies are grossly underreported in this market. Large rental buildings have adopted the tactic of only listing two apartments when they may have twenty available, so as not to depress pricing further. Only once one of the two rentals listed becomes occupied will the landlord bring another unit to market. These landlords are being forced to negotiate with renters and in worst case scenarios, they’re offering up to several months free on 18-24-month leases to mitigate their losses and fill their units.
In sum, it is of benefit to both renters and owners to work with a capable broker during this time to assist them in maximizing the value of their investment home or dollar.