Manhattan Apartment Rents Rise 5.9% as Jobs Rebound, Citi Habitats Reports
Manhattan apartment rents climbed 5.9 percent and rent concessions fell in the fourth quarter as rising employment helped revive demand, Citi Habitats reported.
The average monthly rent rose to $3,127 from $2,952 a year earlier, based on transactions by the company’s brokers. Concessions such as a rent-free month or payment of broker fees were offered on 22 percent of apartments in December, down from 60 percent a year earlier, New York-based Citi Habitats said.
“Overall, 2009 compared with 2010 is a complete 180,” Gary Malin, president of Citi Habitats, said in a telephone interview yesterday. “It went from a tenant’s market to a landlord’s market.”
New York City’s unemployment rate fell to 9.1 percent in November, the lowest since April 2009. Private-sector employment rose 1.6 percent in the 12 months to about 3.2 million, with financial-services jobs rising by 5,900, according to the New York State Department of Labor.
The apartment vacancy rate in Manhattan fell to 1.3 percent in December from 1.8 percent a year earlier, Citi Habitats said. Vacancies are typically higher and rents lower during the fourth quarter because fewer people want to move to New York during colder months, Malin said. The rate was just under 1 percent during the third quarter, usually the most active, he said.
In addition to the rise in employment, apartment demand is being boosted by people relocating to shorten their commutes and those taking advantage of rents 9 percent below the peak of 2008’s second quarter, Malin said. Also, lenders are demanding bigger down payments and better credit for apartment purchases, spurring some potential buyers to rent instead, he said.
Apartment Sales Drop
Manhattan apartment sales dropped 7.2 percent in the fourth quarter from a year earlier, when tax credits for homebuyers and pent-up demand after the 2008 financial crisis created a surge in sales, New York appraiser Miller Samuel Inc. said Jan. 4.
Among rentals, the cost of leasing the average studio apartment rose 6.2 percent to $1,840 a month, one-bedrooms climbed 7.2 percent to $2,512, two-bedrooms gained 5.2 percent to $3,467 and three-bedrooms increased 5.7 percent to $4,690, according to Citi Habitats.
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