The New York City rentals market recovery is speeding up. Median asking rents are still below where they were before the pandemic began. But, less than one year after Manhattan rents fell below $3,000 to $2,750 for the first time in a decade, Streeteasy’s July Market Reports show they are back at that threshold.
July Market Reports show that Manhattan rents are up at the $3,000 mark once again. NYC rents are rising citywide: the city’s median asking rent in July was $2,675 — up from a pandemic low of $2,500.
The quick rise in rents can be attributed in part to this summer’s massive spike in demand, according to Streeteasy.
New Yorkers who left town during the pandemic started returning, while those who stayed were upgrading, or moving again to avoid rent increases on their lease. And many people who had always wanted to live in New York City decided that, with prices unusually low this summer, it was finally the right time.
In July, renter activity exceeded pre-pandemic levels — significantly. Compared to July 2019, StreetEasy saw 59 percent more renter visits, 63 percent more rental listing views, and 76 percent more overall contacts on rental listings.
The Era of Pandemic Discounts in NYC May Be Over
The share of rental discounts around the city is also changing rapidly. Last July, in the midst of the pandemic, 29.1 percent of rentals in New York City had advertised a discount within that month. This July, only 9.1 percent of rentals were discounted — a significant drop of 20 percentage points.
In July 2019, during a typical busy summer rental season, 15.6 percent of rentals were discounted. So this year’s figure of 9.1 percent is particularly low. In fact, it’s the lowest it’s been in a decade.
In Some Areas, NYC Rents Are Now Surpassing Pre-Pandemic Levels
Median asking rents borough- and city-wide remain lower than they were prior to the pandemic. But in some neighborhoods, asking rents have now surpassed pre-pandemic levels. This is particularly the case in popular downtown Manhattan neighborhoods, including Flatiron, the East Village, the Financial District, and Nolita.
Parts of Brooklyn are also experiencing a rapid recovery in rent prices. Neighborhoods such as Bedford-Stuyvesant, Greenpoint, and Downtown Brooklyn all had median asking rent prices that were higher in July 2021 than they were before the pandemic started.
NYC’s Rising Rents: Looking Ahead
“I expect rental price growth to continue, but not at such a rapid clip,” says StreetEasy economist Nancy Wu. “Renters began returning to the market in full force this summer and landlords have taken notice. They are trying to make up for the time and money that they lost during the lull of the pandemic by raising prices and erasing discounts. Prospective renters should be prepared for tougher negotiations over the next few months right now, but I expect price growth and landlord expectations to normalize as we head into the colder months.”
Manhattan Rental Inventory Is Disappearing Fast
- Manhattan’s median asking rent rose to $3,000, the highest it’s been since last July when rents were still in a freefall. This is still significantly lower than pre-pandemic asking rents, though. They hovered around $3,500 from 2019 until the beginning of the pandemic.
- Rental inventory in Manhattan also continued its steady decline. There were 21,567 rentals available in Manhattan in July, down an incredible 48% from the peak of inventory supply during the pandemic last August.
- In Manhattan, 9.5% of rentals were discounted in July. That’s the highest share of all boroughs analyzed, but much lower than a typical year. In July 2019, 15.6% of Manhattan rentals were discounted.
- Many neighborhoods have already seen asking rents surpass pre-pandemic levels. In Flatiron, for example, the median asking rent rose to $5,304 in July – the highest on record by more than $100.
NYC Rental Discounts Are Rarest in Brooklyn
- The median asking rent in Brooklyn rose to $2,600, closing in on the pre-pandemic highs of around $2,700 seen in summer 2019.
- The number of available rentals in Brooklyn fell to 17,411 in July — down 33% from the peak of inventory supply in August 2020. This was still higher than the amount of inventory available in July 2019 when 15,437 rentals were on the market.
- In Brooklyn, 8.7% of rentals were discounted in July. That’s the lowest share of all boroughs analyzed, and significantly lower than last August when the share of discounts peaked at 26%. In July 2020, 24% of Brooklyn rentals were discounted.
- Of all Brooklyn neighborhoods, Greenpoint asking rents rose the most year-over-year. The median asking rent in the neighborhood reached a record high of $3,395 – $80 more than the previous high in August 2019.
The Number of Rentals Available in Queens Remains High
- Median asking rents in Queens climbed to $2,200 in July, closing in on pre-pandemic prices which hovered around $2,300.
- Queens rental inventory remained relatively elevated compared to Manhattan and Brooklyn. There were 6,266 rentals available in the borough in July, down 21% from the inventory peak which occurred in October 2020. In July 2019, 5,293 rentals were available in Queens – so there are still nearly 1,000 more available rentals now than there were in the summer before the pandemic.
- The share of rentals discounted fell to 8.9% in Queens. During the summer of 2019, 13.8% of Queens rentals were discounted, signaling that Queens landlords are also responding to the current spike in demand.
- Rents in some of Queens’ most expensive neighborhoods are rising quickly, but still have not met their pre-pandemic levels. In Long Island City, the borough’s most expensive neighborhood, the median asking rent rose to $3,250. The median asking rent there peaked in August 2019 at $3,382. During the pandemic, asking rents in Long Island City hit a low of $2,867 in September 2020.