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- The report found that during October, rents declined, while the vacancy rate rose. However, landlords have not upped their use of move-in incentives to drive traffic to their properties. We anticipate concessions to become more prevalent as the season progresses.
- Last month, the average monthly rental price for a Manhattan studio was $2,203. For one-bedroom homes, the average was $3,051. For two-bedrooms, the average rent was $4,047. Finally, the average three-bedroom apartment rented for $5,289.
- Average rents saw the largest declines for studio apartments, where they fell 2% from September. Rents fell 1% on average for two-bedroom homes. Rents were stable for one- and three-bedroom units, where prices shifted by negligible amounts.
- In October 2015, the borough-wide vacancy rate rose to 1.81% from September’s rate of 1.62%. Year-over-year, Manhattan’s vacancy rate also climbed. In October 2014, the borough’s vacancy rate was 1.62% (the same as in Sept ‘15).
- When examining incentives, 8% of rental transactions brokered by Citi Habitats offered a free month’s rent and/or payment of the broker fee to entice new tenants in October, down from 10% in September. Last month’s percentage is slightly higher than a year ago (October 2014) – when only 7% of new leases included an owner-paid concession.
“This report clearly reflects the overall disconnect between the level of interest in the borough’s rental market and asking rents,” commented Gary Malin, President of Citi Habitats. “The pool of renters may not be as deep as landlords think. Building owners have had an incredible run, and due to historic high demand, have understandably pushed pricing higher and higher. Rents, especially for smaller-sized apartments, are still significantly more expensive than they were last year. With a vacancy rate approaching 2%, landlords need to make price adjustments or offer significant incentives to spur activity – especially as the holiday season approaches.”
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