To the surprise of many people, real estate income in metropolises such as New York is stable, this means that despite everything we have experienced in recent years, the real estate sector has not been affected but quite the opposite. Real estate prices are increasing higher and higher, benefiting the owners of these beautiful residences.
What is evident is that the amount of properties available in Manhattan has increased for two consecutive months and contracts signed fell by 7% month over month, in addition, days on the market increasing by 5% during the same period .
With respect to Brooklyn, we can see a difference as all its areas have poor availability. In July, rents were up 4% month-over-month, leases signed were up 1%, and the time-on-market for each properties were up a further 2% compared to June of the same year.
With the changes in habits that we have been experiencing, such as working from home, it is very noticeable in the environment that tenants want to stay in their places for larger periods to live and work. That’s how right now we are wondering if maybe is it the end of the “short term rents” and the beginning of more “long-term rents” ? What do you prefer and think when you want to renting your property, do you prefer that your tenants sign contracts for short rents or long rents?
Manhattan Rents:
- July 2022’s median Manhattan rent of $4,250 remained unchanged from June but was 33% higher compared to last year. July marked the eleventh consecutive month of year-over-year median rent growth.
- For units in doorman buildings, median rents increased 26% annually to reach $4,900 per month. For non-doorman product the median rent hit $3,500—a 37% rise.
- As usual, significant year-over-year average rent gains were seen across the board, regardless of apartment size. Pricing for three-bedroom homes increased the most, rising 35% to $9,399. Rents for one-bedroom apartments climbed 29% to $4,410. Meanwhile, rents for both studio and two-bedroom homes rose 27%, hitting $3,208 and $6,136, respectively.
Listings/Vacancy
- In July 2022, there were 5,346 active listings across Manhattan, up 3% from June but down 48% year-over-year.
- The Manhattan vacancy rose slightly to 2.09% in July (vs. 2.03% in June). This has been the second consecutive month where the vacancy rate ticked up, which is unusual for the summer season. We attribute these increases to tenant push-back against record-high rents.
- Midtown East had the highest vacancy rate in July (at 3.06%) while vacancy was lowest in Gramercy (at 0.85%).
Leasing Activity
- With 4,555 new leases signed, July 2022 leasing activity declined 7% from June. In addition, 44% fewer leases were signed when compared to July 2021.
Brooklyn Rents
- Brooklyn’s median rent rose to $3,645 in July 2022, up 4% from June and 35% year-over-year. Median rent has increased year-over-year for 10 consecutive months and has reached a new high in the borough.
- At $4,217, the Brooklyn average rent climbed 3% month-over-month and 34% annually. Rents for three-bedroom homes saw the most annual growth, as prices jumped 48% vs. last July.
Listings
- There were 3,010 active listings available in Brooklyn during July 2022, a 10% decline from June and a 41% drop compared to last July.
- The average Brooklyn rental spent 59 days on the market—up 2% since June and 16% year-over-year. Days on market increased for all unit types except for one-bedrooms, where days on market declined for the third consecutive month.
Leasing Activity
- There were 1,236 leases signed in Brooklyn during July 2022, 1% more than in June but 41% fewer than were executed in July 2021. Contrasting Manhattan’s, leasing activity climbed in Brooklyn (albeit slightly) month-over-month.