The long and short of it is this: things seem to be getting, and staying, more expensive. Bad news, right? Well, at least it's not by muchyet. Even though July's rental data saw some slight setbacks compared to June's, overall, things are moving onward and up. According to Douglas Elliman, average rents in July were the highest they've been in six consecutive Julys, coming in at $4,022 in Manhattan, $3,111 in Brooklyn, and $2,709 in Queens. Year-over-year rents in Brooklyn continued to rise for the 14th consecutive month.
With the influx of new jobs (read: more employees) in the city as well as a high number of renters trying to buy who are being denied mortgages, rental apartment demand remains strained, creating what real estate appraiser and Elliman report compiler Jonathan Miller calls a "logjam" of sorts. While sales are still thriving, city dwellers who can't secure mortgages are relying on rentals, thereby driving up rents the most forcefully in smaller apartmentsstudios and one bedrooms. Smaller apartments saw the largest rent gains in Manhattan and Brooklyn. The average price for a studio in Manhattan increased 7.1 percent from last July to $2,573. The average price for a one-bedroom in Brooklyn increased 6.2 percent from last July to $2,658.
Brooklyn and Queens saw a dramatic addition of new rental apartments this month, both year-over-year and from June. Queens saw the addition of 203 apartments in July, up 136 percent from the previous July's 86. Brooklyn had 126 percent more new inventory appear on the market in July compared to last year. New development is primarily targeting the upper tier and luxury classes, meaning it's not providing much relief for the smaller-apartment market logjam. Luxury is at the top of the market, and new development is pandering to that rather than embracing all price levels.
Prices remain high throughout Queens following June's dip, which was brought on by an unusual onslaught of one-bedroom apartments and therefore a supply glut. Of the apartments in neighborhoods tallied for the Elliman report (that's Long Island City, Astoria, Sunnyside, and Woodside), one in four were in new developments. Median rental prices in the neighborhood are up 10.5 percent year-over-year.
While Manhattan rents are still climbing, they aren't doing so at quite the breakneck pace seen previously; they've found their rhythm. According to Citi Habitats, changes in rent between June and July across the borough were largely statistically negligible, with rents remaining unchanged in all but the three-bedroom category, which saw a 2 percent decrease. Tribeca and Soho remained the borough's priciest neighborhoods through July, with a median rent of $5,300. Refreshingly, the Financial District/Battery Park City area trailed at $3,600 (likely because it's having a boom moment when it comes to supply).
Meanwhile, MNS found that in Brooklyn, while Dumbo remains the priciest neighborhood, it also saw the largest decrease in rents in the borough year-over-year by 0.3 percent (whoa) to $4,071. Crown Heights saw the largest increase in rents at 17.5 percent to $2,110. MNS explains that growth in developed areas like Dumbo and Williamsburg is slowing down while relatively underdeveloped areas like Crown Heights are on the upswing. The one exception to this appears to be brownstone-y Cobble Hill, where average rents remain stable despite large changes in rent costs between July 2013 and July 2014.
·The Elliman Report
· MNS Report Manhattan / Brooklyn
· Citi Habitats Report