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Rents Continue to Climb in November, But Not Very Much

Good news, Manhattan renters: rents only rose a little bit in November! The rental reports were released at midnight, and the Elliman report found that the median rent only increased 1.4 percent from last year. "The last time it was lower," says report preparer Jonathan Miller, "was September 2011 when it was 0 percent." This puts the median rent?Miller's preferred metric since it removes outliers?at $3,195, while the average rent clocks in at $3,913. Citi Habitats found the average to be a bit lower, at $3,868. Miller notes that the pace of rising rents is likely easing because more people are deciding to buy as mortgage rates have been sharply falling. Despite the small increase, renters still resisted higher prices, as new rentals jumped 41 percent. This means that renters opted to try their luck elsewhere rather than accept the higher renewal price. But since the vacancy rate is still very low, 1.59 percent, landlords are feeling the pressure to keep rents high. Alas.

"Landlord concessions remain a thing of the past," says Miller. The Elliman report found that only 4.2 percent of rentals had them, down from 8.6 percent last year. The Citi Habitats report also found a low amount of concessions, putting the rate at 5 percent.

While many thought that Hurricane Sandy would make the vacancy rate even lower, the Citi Habitats report notes that the storm and displaced victims has not had the anticipated effect. "While there are a few examples of buildings that will be uninhabitable for several months," said Citi Habitats president Gary Malin in a press release, "fortunately for most Manhattan residents, Hurricane Sandy caused only a short-term displacement from their homes." However, the report found that rents in the Financial District fell a whopping 12 percent, which is likely due to the decrease in inventory for that neighborhood.

Over in Brooklyn, rents are still on the up and up, with the median price increasing 10.1 percent from year ago levels to $2,698. New rentals surged even more than in Manhattan, jumping 59 percent, but renters won't be finding much relief as tight credit and an improving job market will keep rents elevated.
· November rental market report [Elliman]
· Market reports [Citi Habitats]
· All rental market report coverage [Curbed]