Manhattan rental market remains strong
The Real Estate Group New York, in its first Year-End Manhattan Rental Market Report, said that the borough’s rental market remained “relatively strong” last year.
Non-doorman two-bedroom buildings had the year’s biggest increases, climbing 14.1 percent. Non-doorman studios increased by 6.4 percent, while one-bedrooms increased by 2.6 percent.
For doorman buildings, one-bedroom apartments increased the most at 4.9 percent, while two-bedrooms increased 3.3 percent and studios increased 2.2 percent.
Prices began to weaken in the fourth quarter, and the report said the credit crunch and threat of job cuts in Manhattan “could easily push the rental side of the market from positive to negative.”
"The citywide numbers we're seeing do indicate healthy growth, which suggests that Manhattan real estate has so far managed to weather the nervous conditions of a weakening U.S. housing market," Daniel Baum, The Real Estate Group’s co-founder and COO, said in a statement. "On the other hand, significant rental declines in some areas of the city and all-around softening prices in the fourth quarter of '07 may be foreshadowing declines in '08."
Soho was the only neighborhood to see lower year-end declines across the board. Soho’s “reputation for luxury lofts may have sent renters looking for more traditional apartments to other neighborhoods,” the report said.TRD
Comments
Marc Lewis
Hi, this is Marc Lewis the COO of Century 21 NY Metro and I would like to comment on the above article. Although rents are up over last year I dont believe its accurate to say rents are up for the year without emphasizing that the recent trend, especially for the last quarter, which is showing a lot of weakness. The amount of people coming to NYC for new jobs has certainly been much less and the inventory of unrented residential units is much higher than in years past. Even with less rental buildings being constructed the lack of demand is almost unprecidented in my 35 years in the business. Landlords, accross the board are reporting this and only the ones who sharpen their pencils and reduce rents, pay fees or offer other incentives are rapidly renting their units. Sincerely, Marc Lewis 212-872-2223
Comment #0 Posted By: Marc Lewis 01/08/08
Daniel Baum
Hi Marc,
This is Daniel Baum, C.O.O of TREGNY, and author of the report. I couldn't agree with you more when you say "....emphasizing that the recent trend, especially for the last quarter, which is showing a lot of weakness.". In fact if you take a look at our report on a monthly basis (www.tregny.com/reports.jsp) you will find that we were the first firm to come out publicly way back in August, amidst a shower of naysayers i might add, letting the market know a cooling was on the horizon, and that has only been reiterated by the market's performance over the last quarter. However, it is important to note that what you are looking at is an annual reporting for 2007 which shows these gains. I hear, and agree with your concerns and vision of the current state of the rental market, as reflected in some of my quotes in the article above. Thanks for the input and support.
Sincerely,
Daniel
Comment #1 Posted By: Daniel Baum 01/08/08
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