NYC lease signings surged in December, a typically slow month for rentals
- New leases nearly doubled in Brooklyn and were up 58.1 percent annually in Queens
You can expect Manhattan's rent to stutter a bit in coming months, but you won't see steep increases like last year.
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New York City apartment hunters defied expectations in December—typically thought of as a slow time for the rental market. As a result new leases surged in Manhattan, Brooklyn, and Queens, according to the December Elliman Report for those rental markets.
Lease signings were especially active in the outer boroughs, says Jonathan Miller, president and CEO of appraisal firm Miller Samuel and author of the report. New leases nearly doubled annually in Brooklyn and were up 58.1 percent year over year in Queens, the highest rate in 21 months, which Miller attributed to demand for new development there. In Manhattan, new leases were up 14.2 percent compared to December 2022.
Manhattan’s median rent ($4,050) was flat compared the previous year and up slightly month over month (1.3 percent) for the first time since July, despite our prediction last month that Manhattan rent would continue to slip in the months ahead due to lower mortgage rates luring renters into the sales market.
You can still expect Manhattan rents to slip and slide in the future, Miller says, noting renters “won’t see a decline every month.”
What you also won’t see is steep increase in rents each month, which was the case for an extended period following the Federal Reserve’s string of rate hikes that began in the spring of 2022, a moves that caused buyers to turn to rentals instead. Because the pressure on the rental market has been removed, you’ll see some zigzags in the rental market numbers, he explains.
And even though new listings are being added to the rental markets, there’s still a lot of competition for rentals, including bidding wars. Manhattan listings were up 33 percent compared to December 2022.
Miller says Manhattan landlords appeared to be less successful in retaining tenants last month—and points to a jump in the vacancy rate from 2.93 percent in November to 3.42 percent in December as evidence. In December 2022, it was 2.69 percent.
“That alone suggests lower rents [for the future] but not necessarily a correction,” he says.
Brooklyn’s annual rent increases yet again
In Brooklyn, median rent rose year over year for the 24th time to $3,469. But this was a drop of .7 percent from the previous month, and slight declines on a monthly basis have been a trend in recent months. New listings were up for the fourth, consecutive month, an increase of 8.2 percent but down 18.3 percent compared to November, as per the Elliman Report.
Gary Malin, chief operating officer at The Corcoran Group, which released market reports for Manhattan and Brooklyn, noted that Brooklyn has seen two years of annual rent increases.
“Increasingly, those who find themselves priced out of the most in-demand areas are exploring new neighborhoods in the outer boroughs— especially those near subway lines— in order to bring the cost of a new rental apartment within reach, Malin says.
Queens listings no longer lingering
In Queens, median rent “rebounded” year over year after falling in November for the first time in nearly year. It was $3,485, up 24.1 percent from December 2022.
Listings were up 12 percent annually and they’re no longer sitting on the market so long: Days on market were 18, down from 88 the year prior.
Concessions on the rise for luxury rentals
If you’re looking for freebies, they’re back in the luxury rental segment, according to BOND New York, which also released rental market reports for Manhattan and Brooklyn.
Concessions like free months and landlord-paid broker fees “attracted lots of applications even in the typically less busy holiday season,” the Manhattan report notes. Nearly half of luxury properties in Manhattan are no fee, the report says, with landlords paying broker’s fees in order to attract renters.
MNS Real Estate also shared its December 2023 reports for the Manhattan, Brooklyn, Queens, and Bronx rental markets The reports drill down into the rental market by apartment size and neighborhood.
Some notable findings for December include: The neighborhood with the largest month over month increase in rent was Gramercy, where rents for one bedrooms in doorman building fell by 9.6 percent. Other increases include the Financial District, where two bedrooms in non-doorman buildings increased by 9.5 percent and Chelsea, where studios in doorman building were up by 4.5 percent.
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