MANHATTAN — Rents are down, inventory is up, but tenants are staying put, according to real estate experts.
Manhattan’s median rent slipped just under 1 percent to $3,350 a month compared to the same time last year, according to a report from Douglas Elliman released Thursday, marking the first time ever that rents for all categories — studios, one-bedrooms, two-bedrooms and three-bedrooms — dipped.
Prices edged downward as new inventory hit the market: The number of new listings jumped nearly 12 percent in Manhattan. It swayed landlords to be generous with concessions. More than a quarter of all transactions had something to sweeten the pot, like a free month’s rent or an owner paying the broker’s fee.
However, the number of new leases fell nearly 28 percent, indicating that renters might be staying put, report author Jonathan Miller said.
“I look at that as an indicator of more [lease] renewals,” Miller said of the drop in new deals. “The problem really is that we have a lot more supply coming, but it’s still skewed heavily to the luxury market.”
Nathan Tondow, of the real estate search engine Zumper, also said renters have been staying in place despite price drops.
His platform found that February median monthly rents for one- and two-bedroom apartments across the city were down about 10 percent from a year ago to $2,930, for one-bedrooms and $3,420 for two-bedrooms.
“We’ve been hearing from a lot of brokers that landlords are offering [renewal] leases at the same price or maybe even a little less,” he said, noting that renters are gaining leverage in the market.
“With a mix of new development in Brooklyn, like in Fort Greene, where they’re trying to get higher rents mixed in with developers buying smaller walk-ups, renovating them and raising rents, it’s creating the perfect storm for landlords not getting the prices they want,” he said.
Zumper saw 32 percent of its listings last month offer incentives, he said.
Concessions have been effective in keeping vacancies down, Miller said, noting that the vacancy rate was at 2.44 percent, up slightly from last year's 2.31 percent.
Still, many renters who aren't renewing their leases may be leaving the city to buy in the suburbs, which are booming, Miller believes.
Westchester had its highest fourth quarter of all time, and Long Island and Fairfield, Conn., saw sales higher than in more than a decade, he said.