Is the rental market going to crash?

John Walkup

Talking Manhattan on UrbanDigs.com
What's the spread between actual and net effective rents right now? 3-months free, Amex cards, etc sound great, but how many are actually getting meaningful reductions in actual rent? I wonder how many lenders are starting to rethink the math on rent rolls.
 

David Goldsmith

All Powerful Moderator
Staff member
I wish StreetEasy would force everyone to use their new, much more transparent format for representing base and effective rents. I agree re:lenders - these buildings aren't keeping these tenants. People in Stuyvesant Town are moving out in droves because they are offering incentives only to new tenants. I got in a cab this week and the driver told me he just dropped off someone who told him they worked in management and there were over 1100 vacancies.
 

David Goldsmith

All Powerful Moderator
Staff member
Rental listings in Manhattan hit 14-year high as vacancies soar
Median rental price fell 11 percent as residents retreat from Manhattan

Looking for a new apartment to rent in Manhattan? You’ve got options.
The number of listings in the borough hit a 14-year high last month. The total of 15,923 is more than triple that of the same period last year, according to the latest Douglas Elliman rental report from appraiser Jonathan Miller.

The vacancy rate hit 5.75 percent — for New York City, a stunning figure.
Concessions in September also reached a record high, as landlords compete for tenants in a city struggling with mass unemployment and the departure of several hundred thousand residents.
Another factor working against landlords is that many New Yorkers are no longer tethered to their apartments: Remote work remains the norm and most schools are still operating virtually.

The median net-effective rent, which is rent with concessions factored in, fell to $3,036 in Manhattan, an 11 percent drop from $3,411 in September 2019.
The type of properties renters are choosing sheds light on the effects of the pandemic. Leases for two- and three-bedroom homes went up year-over-year, for example, while the number of new leases for studios fell by 6 percent. Leases for one-bedrooms also dropped.
The median net-effective rent for studios and one bedrooms saw the largest declines in four years that Miller has been tracking them. Rent for studios fell a staggering 17.1 percent.

“The unemployment situation that we’re seeing now is heavily skewed to lower-wage earners,” Miller noted.
In Brooklyn, the real estate market is down overall on the previous year, but the borough has come out far less bruised than Manhattan, in part because the greater space and cheaper rent in Kings County has attracted boxed-in Manhattanites.
“It’s performing much better than Manhattan is, and this is the same parallel with the sales market,” Miller said.
Last month, new leases in Brooklyn hit the highest level in 14 months. The median market rent was down from last year, but the median price for luxury rentals increased 7 percent to $6,500. That figure was $6,076 in the same period last year.

Listing inventory also climbed, reaching a high of 4,235, compared with 3,890 listings the month before. In Queens, the rate of rental inventory was the highest in five years.
Net-effective median rent also declined in Queens for the fifth month in a row. Miller said the declines were tied to the shift in sentiment about Manhattan.
“If you look at the Queens results, they’re more negative than Brooklyn because this is Northwest Queens, not the whole borough,” Miller said of the study area. “One subway stop away.”
“So it has more to do with Manhattan than it does with Queens.”

While the rates of available units in Manhattan will likely alarm homeowners and landlords, Miller said nuance within the figures may offer some comfort.
Notably, the growth rate for new listings appears to be leveling off: After new listings shot up 57 percent in May, that trend has been cooling ever since, with new listings growing by just six percent in September.
 

David Goldsmith

All Powerful Moderator
Staff member
Empty rental apartments in Manhattan triple, nearly hitting 16,000
  • The number of apartments for rent in Manhattan tripled in September, with nearly 16,000 apartments sitting empty, according to data from Douglas Elliman and Miller Samuel.
  • The vacancy rate in Manhattan, which is typically 2% to 3%, is now just under 6%.
  • The median net effective rents — those that include concessions — fell by 11% to $3,036.
The number of apartments for rent in Manhattan tripled in September, with nearly 16,000 apartments sitting empty, according to a new report.

There were 15,963 apartments for rent in September, up from 5,299 a year earlier, according to data from Douglas Elliman and Miller Samuel. The vacancy rate in Manhattan, which is typically 2% to 3%, is now nearly 6%.

Prices are also dropping. The median net effective rents — those that include concessions — fell by 11% to $3,036. The big question for New York City, which is facing a population decline, higher crime rates and high unemployment, is whether prices can fall enough to lure residents back to the city.

“I don’t think we’re there yet,” said Steven James, president and CEO of Douglas Elliman’s New York City brokerage. “I think we have a little ways to go. The consumer knows the landlords are on the ropes and they know they’ve got them.”

Manhattan rents remain high by national standards. The average rent for a one-bedroom in September was $3,307, while rents for a two-bedroom average $4,817. The low end of the market has been hit especially hard, since lower-paid workers in service industries and restaurants have borne the brunt of the economic pain in New York. Rents for studio apartments have fallen by 14%.

Rentals account for two-thirds of the apartments in Manhattan, which is the largest rental market in the country. As rents fall, and more apartments sit empty, the pain could begin to cascade down to smaller, less capitalized landlords and to mortgage lenders and banks. It could also start to impact property tax revenue — which is the largest source of revenue for New York City — as landlords don’t have rental income to pay their taxes.

“The chain reaction is going to be difficult, especially for newer landlords that haven’t been through something like this before,” James said.
 

David Goldsmith

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NYC rents continue to drop, and landlords are feeling the crunch
Small property owners will take to the streets to demand action from City Hall

UPDATED, Oct.16 2020, 10 a.m.: Rents across the city continued their downward slide in September, and hundreds of frustrated landlords are feeling the crunch — and demanding relief.
Median rents in Brooklyn, Manhattan and Queens all fell in September, according to an analysis of active apartment listings as of Sept. 30 by The Real Deal. The largest decrease was Queens, where the median rent fell nearly 12 percent, from $2,600 to just $2,295. The drop was slightly less steep in Brooklyn; there, rents fell 7 percent, from $2,914 to $2,700. It was the same story in Manhattan, where the median rent fell 5 percent, going from $3,418 to $3,200.
Manhattan did see an improvement in inventory: Active apartment listings in the borough decreased in September, from 21,736 to 20,182. That trend didn’t bear out in the other boroughs: In Brooklyn, apartment listings increased by nearly a third, from 4,628 to 5,945. In Queens, listings increased 71 percent, from 1,307 to 2,238.

Since Covid-19 struck, the vacancy rate in Manhattan has climbed to historic highs. In August, the vacancy rate reached 5.1 percent — the third record-breaking month in a row since appraiser Jonathan Miller started keeping track many years ago.
Landlords continue to lower rents in a bid to keep their tenants and salvage their investments, but the loss of revenue, along with nonpayment from some renters — plus limits on evictions that are in place through the end of the year — is putting pressure on smaller property owners, who want City Hall to take action.

A coalition of groups representing smaller landlords plans to take to the streets on Friday to demand that the city slash property taxes, eliminate property tax late fees altogether, or delay the tax lien sale, which is currently scheduled for Nov. 3.
Joanna Wong, a landlord who represents one of the groups organizing the rally, Small Property Owners of New York, said that many smaller landlords are frustrated at tenants who are able to pay rent but choose not to because they cannot be evicted, while owners’ property tax bills pile up.
“I understand there are serious issues out there, but that doesn’t mean they should have a free ride,” Wong said. “Just because people are hurting doesn’t mean it’s a free-for-all.”

One bill that sought to provide a subsidy for low-income renters came with too many eligibility requirements, Wong said. One of her tenants was not able to receive a state subsidy because part of her income was in cash.
Jan Lee, a member of NY Chinese Property Owners Alliance whose family owns about 25 units in Chinatown, said that small landlords have different issues from those of larger ones, and need to “have some distinctive voice.”
Lee said a rental voucher program, sponsored by Manhattan state Sen. Brian Kavanagh, was not sufficient to meet landlords’ needs. Kavanagh’s bill allocated $100 million from federal funds to provide subsidies to landlords whose tenants are eligible, but the state agency tasked with doling out the funds was overwhelmed by requests when the program went live, and questions remain over how much money has been allocated.

“Everyone knows it’s not enough, but the idea that canceling rent is a solution because property owners have this big pot of money that we can dip into is fanciful and illogical,” said Lee. “We’re not for anything that severs the economic stream.”
CORRECTION: An earlier version of this article misspelled the name of a member of NY Chinese Property Owners Alliance. It is Jan Lee, not Jim Lee.
 

David Goldsmith

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Staff member
Median rent in Manhattan falls below $3,000 for first time in nearly a decade

The median asking rent for a Manhattan home has fallen below $3,000 per month for the first time in nine years, according to a report released Friday from New York City real estate firm StreetEasy.
The firm’s third-quarter report also marked the first time Manhattan, Brooklyn and Queens all recorded year-over-year rent declines since 2010.

The report comes amid increased vacancies and a struggling rental market since the coronavirus pandemic hit New York City hard earlier this year.

While the average asking price has decreased, StreetEasy recorded that rental inventory in Manhattan increased by 69.8 percent in the third quarter, with 72,267 new listings added. According to the firm, this figure is nearly 30,000 more than it was at this time last year.
Rental discounts have also increased, with the median rental discount in Manhattan hitting 9.1 percent, 5.2 percentage points higher than in 2019.
“Renters are no longer willing to pay the commute premium of living in Manhattan when they do not need to commute to an office five days a week,” StreetEasy economist Nancy Wu said in an announcement on the report.

“Landlords across the city, but particularly in Manhattan, have to be willing to face some really hard hits if they want to fill their units,” she added. “They’re being forced to cut the location premium out of their asking price in order to compete with larger and more affordable apartments in the outer boroughs.”
New York was one of the states ravaged by COVID-19 in early months of the pandemic in the U.S., with daily increases in the number of infections reaching as high as nearly 10,800 in April, according to The New York Times coronavirus database.
Since COVID-19 first hit the city earlier this year, Broadway shows, restaurants and other tourist attractions have been forced to shut down, leading to 896,000 private sector jobs lost between February and April, according to the city’s comptroller office.

The city’s unemployment rate reached as high as 20 percent in July, although the New York City Department of Labor reported that this had fallen to 14.1 percent in September.

While the city has been able to significantly limit the number of new infections in recent months, certain areas, including in Brooklyn and Queens, have had new spikes, prompting New York City Mayor Bill de Blasio (D) to implement a two-week closure on nonessential businesses in those communities earlier this month.
As of Thursday, the New York City Department of Health had recorded a total of 250,489 coronavirus cases, with 58,512 hospitalizations and 19,299 confirmed deaths.
 

David Goldsmith

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Staff member
Looking at the chart for Manhattan I was a bit surprised at the spike at "over $10,000"
https://therealdeal.com/2020/10/23/dead-weight-a-breakdown-of-nycs-rental-listing-glut/

Dead weight: A breakdown of NYC’s rental listing glut
Manhattan listings make up the bulk of NYC rentals on the market

The pandemic and subsequent shutdowns have dealt a serious blow to New York City landlords, sending vacancy rates soaring and rents to the ground.
Manhattan rental vacancies reached 5 percent in August, the highest level in 14 years, according to Miller Samuel. That coincided with a surge in listing inventory, which shot up to 15,000 listings, a 166 percent jump from August 2019. In August and September, citywide rents fell compared to last year.
Manhattan’s contributions to the city’s inventory glut are colossal, according to The Real Deal’s analysis of LavaMap’s active rental listings as of Sept. 30. With 20,147 listings, that borough took up 72 percent of all listings in the city. Brooklyn came in a distant second with 5,938 listings, while Queens had 2,231 listings.

The five neighborhoods with the most active listings — all of which were in Manhattan — were the Upper West Side (1,539 listings), Hudson Yards-Chelsea-Flatiron-Union Square (1,452 listings), the West Village (1,332 listings), Soho-Tribeca-Civic Center-Little Italy (1,243 listings) and Turtle Bay-East Midtown (1,223 listings).
In Brooklyn, Park Slope-Gowanus had the most available listings, with 539, while Hunters Point-Sunnyside-West Maspeth had 454 in Queens.
One-bedroom apartments accounted for the largest share of listings by apartment size, with 10,129 active rentals making up 44 percent of all listings citywide. That was followed by 8,291 two-bedroom apartments and 4,467 studios. The size of apartments on the market varied by borough, with larger apartments easier to find in Brooklyn and Queens.

Citywide, rentals with prices ranging from $2,000 to $2,499 made up about 20 percent of all listings. That’s followed by those in the $2,500 to $2,999 range, with about 19 percent of all listings. The $3,000 to $3,499 bracket had about 12 percent of all listings.
Like apartment size, the price distribution of active listings varied considerably per borough. The pricing of rental inventory in Manhattan was more spread out — and more expensive, with 7 percent of listings asking upwards of $10,000 per month. In Brooklyn and Queens, the price distribution was heavily concentrated in the $1,500 to $3,500 range.

 

David Goldsmith

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Staff member
Equity Residential sees profits drop 58%
Occupancy, rents are down across Sam Zell-owned REIT’s portfolio

Sam Zell’s Equity Residential was hit with a 58 percent decline in income in the third quarter, with urban flight severely impacting its apartment portfolio.
The REIT’s net income in the third quarter was $95.4 million, down from $227.8 million in the same period last year, the company reported Wednesday. That’s a significant drop from the second quarter, when the company recorded $271.5 million in income. Its total revenue during the third quarter was $622.4 million, down by 9 percent year-over-year.

On the earnings call, the real estate investment trust’s CEO Mark Parrell told analysts that renters decided to leave their apartments as employers delayed plans to bring workers back to offices.

“This occupancy pressure in turn caused further rent declines and increased concessions,” Parrell said.
About 23 percent of the company’s rental portfolio is located in cities like San Francisco and New York, which continue to be impacted by suburban migration.
The portfolio-wide occupancy rate was 94.8 percent, down by 1.7 percentage points compared to a year ago. But it’s lower for urban properties: The occupancy rate for Equity’s New York units is just below 90 percent, said COO Michael Manelis.
The portfolio-wide average rent as of September was $2,765, down by 3 percent from June. The average rent in New York also slipped by 3 percent, from $3,909 in June to $3,805 in September. The landlord has been offering concessions of up to two months of free rent, depending on the market, Manelis said.

The number of tenant applications during the third quarter was 12,700, up about 20 percent compared to a year ago, mainly from renters who opted to move into larger apartments, said Manelis. But the spike was not enough to compensate the number of tenants leaving.

The uptick in applications has continued into October, although the peak rental season typically ends by now in normal years, Manelis said.
“Given the amount of inventory we have available in our urban portfolio, we will need to maintain this velocity through the fourth quarter or reduce turnover in order to continue to hold portfolio-wide occupancy at 94 percent,” he said. “Stabilization and then improvement of our occupancy is what would allow us to dial back concessions and begin increasing rates.”
 

Eric Levine

New member
Any sense for what's the most accurate data for units currently on the market available for rent in Manhattan? And what's the denominator being used to calculate vacancy rate? If you read the articles above, there's a pretty wide difference between the stats that Elliman/Miller Samuels, StreetEasy, and LavaMap are quoting. No doubt it's rough no matter which data set you want to use, but wondering how scientific they are really getting with these data sets.
 

David Goldsmith

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That's a very good question for which I don't know the answer. I suspect everyone is undercounting. There is no "official" source, so I suspect most are using some listing systems, whether driven by the REBNY data feed RLS or proprietary (like StreetEasy). But a lot of landlords are not officially listing all units available even if they used to so there is no way of knowing how many units are actually available.

I know of several buildings where people are telling me there is 20% vacancy but only have a handful of units listed (BTW this has always been a standard practice for new construction - i.e. to only list a handful of units even though the entire building is available). From what I understand, Stuyvesant Town/Peter Cooper Village used to list all availability on their website, but since ?June? you can see instances of over 200 units disappearing overnight and they currently have approximately 275 units shown and I told there are over 1,000 vacant. StreetEasy shows 23 available. This website (UrbanDigs) which uses RLS feed shows none (unless I'm using the search incorrectly).

I'm willing to bet StreetEasy is using what's listed on their site. But there's no question that undercounts, especially since they started charging for rental listings. They never had everything, but certainly if they are charging per listing there is an incentive for those listing/paying only to list representative examples (on top of the perceived incentive of some landlords not to seem week by showing large vacancies).

I don't know what Miller Samuel is using but I suspect it is whatever Douglas Elliman has in their system (I would love it if he came here and shed some light on this).

Does LavaMap show the available rentals in buildings? I'm not that familiar with the site (I use Property Shark for what I perceive to be the type of info available there). Or did they just get quoted somewhere as to how many units are available?

In any case, I don't see how anyone can be using anything other than some form of "self reported" numbers by landlords. So if landlords are holding back listings I don't see how vacancies aren't being undercounted.
 

Jonathan Miller

New member
That's a very good question for which I don't know the answer. I suspect everyone is undercounting. There is no "official" source, so I suspect most are using some listing systems, whether driven by the REBNY data feed RLS or proprietary (like StreetEasy). But a lot of landlords are not officially listing all units available even if they used to so there is no way of knowing how many units are actually available.

I know of several buildings where people are telling me there is 20% vacancy but only have a handful of units listed (BTW this has always been a standard practice for new construction - i.e. to only list a handful of units even though the entire building is available). From what I understand, Stuyvesant Town/Peter Cooper Village used to list all availability on their website, but since ?June? you can see instances of over 200 units disappearing overnight and they currently have approximately 275 units shown and I told there are over 1,000 vacant. StreetEasy shows 23 available. This website (UrbanDigs) which uses RLS feed shows none (unless I'm using the search incorrectly).

I'm willing to bet StreetEasy is using what's listed on their site. But there's no question that undercounts, especially since they started charging for rental listings. They never had everything, but certainly if they are charging per listing there is an incentive for those listing/paying only to list representative examples (on top of the perceived incentive of some landlords not to seem week by showing large vacancies).

I don't know what Miller Samuel is using but I suspect it is whatever Douglas Elliman has in their system (I would love it if he came here and shed some light on this).

Does LavaMap show the available rentals in buildings? I'm not that familiar with the site (I use Property Shark for what I perceive to be the type of info available there). Or did they just get quoted somewhere as to how many units are available?

In any case, I don't see how anyone can be using anything other than some form of "self reported" numbers by landlords. So if landlords are holding back listings I don't see how vacancies aren't being undercounted.
Hey David,

Everyone is definitely undercounting because we only see new leases, not renewal rentals which have a 1/3, 2/3 relationship. Some of the earliest discounting began in the renewal market during the lockdown. The fact that rentals are not public record makes rental market absolutism impossible. Landlords generally don't report renewal data because that is proprietary to running their businesses. And you're right about landlords, especially in newer buildings, hiding inventory, much like the shadow in new dev condos. I'm not a data provider and I'm more interested in being consistent in tracking the trend.

Jonathan
 

David Goldsmith

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Staff member
NYC rents and inventory dipped in October
Median rent dropped by 3%, and 27K apartments are available

Rents across the city continued their downward spiral in October, even as the number of apartments on the market began to wane, an analysis by The Real Deal found.
In Manhattan, the median rent fell to $3,100, a 3 percent drop since September. The number of listings sunk to 19,500, just below the 20,000 apartments listed the month prior. It’s the second consecutive month where inventory declined in the borough.

Brooklyn saw a similar decline in both prices and inventory. The median rent fell 3 percent to $2,615 from $2,700 the month before. The number of apartments for rent dropped nearly 6 percent to 5,600 from nearly 6,000 in September.
In Queens, prices dropped more substantially to $2,200 from $2,295, a 4 percent dip. Inventory shrank by a mere 2 percent to about 2,200 apartments.

Neighborhoods that saw the biggest price drops included Soho, Tribeca, Greenwich Village, Gramercy Park and parts of the Upper East Side. In Brooklyn, the biggest losers for landlords were Red Hook, Windsor Terrace, Brooklyn Heights, Fort Greene and Gowanus.
A relationship between asking price and inventory was not clear from the data.
TRD’s analysis also looked at which brokerages had the biggest market share of active rental listings last month.
Compass, the Corcoran Group and Douglas Elliman agents represent the lion’s share of available rentals. Together, their agents handled more than 31 percent of the more than 27,000 apartments listed in the three boroughs last month.

Brown Harris Stevens and Move NYC Real Estate round out the top five brokerages, with about 4 percent each of apartments listed throughout the three boroughs.
Zooming in on individual boroughs, the top three brokerages also hold the most listings in Manhattan and Brooklyn. In Queens, however, the top-performing firms are Astoria-based Sterling23 and Living New York, a firm that specializes in landlord representation.
 

David Goldsmith

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Staff member
Landlords pull renters back to NYC with low rents and concessions
New leases in Manhattan hit the highest October total in 12 years, rising 33.2 percent over October 2019, according to the most recent Elliman Report.

Renters returned to Manhattan and Brooklyn in October—in a big way. Months of falling rents and rising concessions—spurred by a record rising vacancy rate—finally encouraged New Yorkers to sign new leases—and not by small margins either.
New leases in Manhattan hit the highest October total in 12 years, rising 33.2 percent over October 2019, according to the most recent Elliman Report for Manhattan, Brooklyn, and Queens rental markets. “It’s the highest October total since the Financial Crisis,” says Jonathan Miller, president and CEO of appraisal firm Miller Samuel and author of the report.
“It’s a thing,” he says, meaning the report's findings are notable but he warns against getting carried away. “It’s just one month, so it’s premature to call it a trend,” he says.
But it is an encouraging trajectory. Manhattan leasing activity had not seen any gains for the previous 14 months and just started to perk up in September, hitting the same level as September 2019. This compares to a year-over-year decline of 23.7 percent for August and a drop of 23.4 percent in July.
What’s interesting is that landlords appear to have reached the threshold that pulls people back into the city through a combination of low rent and major concessions.
Manhattan median rent for October, $2,868, was a 15.9 percent decline from October 2019. Close to a third of Manhattan leases in October came with a concession (60.4 percent) and the average amount of the concession, was 2.1 months—both metrics were new records.
In addition, Manhattan net effective rent, $2,868, fell to its lowest level in 9.5 years and the year-over-year decline in net effective median rent for studios, one bedrooms and two bedrooms was the largest on record.
The problem for renters, however, is that concessions go away after one year, so renters can expect to pay the gross rent the second year—or even see their rent go up based on the gross rent.
But on the other hand, a year from now seems very far away—and lots may change, Miller points out. There could be an effective vaccine and New York City could bounce back—along with high rents.
Miller says landlords are in a tough position right now, and that’s the focus: The vacancy rate in Manhattan hit an unheard level of 6.14 percent in October. “Even with the uptick, there’s still softness ahead for landlords,” he says. Case in point: the number of rental listings on the Manhattan market jumped 218.4 percent—to 16,145 apartments. (Listings have been building up each month and lease signings have not kept pace.)
Brooklyn followed a similar pattern as Manhattan. New leases surged to the second highest October total in 12 years—jumping 20.9 percent over October 2019.
The median rent for Brooklyn, $2,920, was a drop of 2.5 percent from a year ago. More than half of all leases came with a concession (50.9 percent), which was a new record.
Brooklyn listings on the market also increased an eye-popping amount: 207 percent from October 2019—that’s a lot of competition for landlords.

Queens seems to march to a different beat—the borough did not see the uptick in leasing activity. October leases were down 37.8 percent over the prior year, making 15 consecutive months of declines.
Median rent was $2,414, a drop of 15.4 percent over October 2019, and net effective median rent fell at the largest rate in nearly four years of tracking. Listings on the market increased to the second-highest level in more than six years of tracking.
Other market reports
MNS released its September rental market reports for Manhattan, Brooklyn, Queens, and the Bronx. The reports drill down to look at rents by apartment size and neighborhood—and compare doorman to non-doorman buildings in Manhattan. Findings include: The largest monthly decreases were seen for non-doorman two bedrooms on the Upper West Side, doorman two bedrooms on the Lower East Side, non-doorman studios in Soho, and doorman studios on the Upper East Side.
 

David Goldsmith

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Staff member
Manhattanapartment vacancies hit highest number in over a decade

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New Yorkers are still fleeing the city during the COVID-19 crisis — with a record 16,000 apartments sitting empty despite some of the lowest rent prices in years, a new report has found.
The listing inventory in Manhattan peaked at 16,145 last month, more than three times higher than a year ago and a slight uptick from the 15,923 vacancies recorded in September, according to the Elliman Report. The staggering amount of vacancies is also the highest in 14 years.
Data shows the number of vacant units has only increased in the past months. In July, that number was 13,117.
Nearly all of the states in the US, including New York, are seeing a spike in COVID-19 infections — the driving force behind the mass exodus of Big Apple residents at the start of the pandemic that’s continued throughout the year.
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As a result, rent prices have plunged in parts of New York City, including Manhattan, where the median price was $3,100 in October. Rent for a one-bedroom apartment was $3,064, significantly cheaper than a year ago when they went for $3,595.
But the lower prices seem to be luring some renters back — 5,641 new leases were inked in Manhattan in October, up 12.4 percent from September.
“The influx of new lease signings occurred due to increasing affordability since the beginning of the pandemic last spring,” said the report, prepared by Miller Samuel Real Estate Appraisers & Consultants.
Lured by luxury deals, here's where diehard New Yorkers are moving
Landlords are enticing new tenants with better concessions — an offer of free rent and payment of brokerage fees. In Manhattan, 2.1 months of free rent were being offered, versus just 1.2 months a year ago.

Vacancies were also up across the East River in Brooklyn, which saw 4,361 empty units in October — a 207 percent jump from 1,419 a year ago. Fewer people signed new leases from September to October, also, with 1,393 inked last month.
Rent for a one-bedroom in Kings County will now set you back $2,700 — or $150 cheaper than last year.
There was a 5 percent increase in empty apartments from September to October in northwest Queens, with 645 vacant units last month.
Median rent prices also dropped to $2,600, compared to $2,945 a year ago, the report found, with a one-bedroom unit now going for $2,450. Twelve months ago, rent for the same size apartment was $3,000.
“New lease signings and rents have continued to fall since the lockdown ended in June,” the report said.
 

David Goldsmith

All Powerful Moderator
Staff member
Gary Malin spills the beans on what insiders have known for a bit now: the super secret double probation real vacant rate is more like 20%:
 

David Goldsmith

All Powerful Moderator
Staff member
Actually 26% is >1 in 4
Bad year: 1 in 5 units at Gehry skyscraper goes vacant

More than 200 renters have packed their bags and moved out of the tallest residential skyscraper in Manhattan this year.
The New York by Gehry saw rental occupancy fall to 74 percent in September from 98 percent at the end of 2019, according to Trepp, which tracks mortgage-backed securities. Since 2014, occupancy at the 899-unit Financial District building had been above 93 percent, according to Trepp.
Frank Gehry designed the rippling stainless steel tower at 8 Spruce Street, which architecture critics marveled at for its unique “deconstructivism style.” Formerly called Beekman Tower, the building was developed by Bruce Ratner’s Forest City Ratner in 2011.

Below the rentals, the property has an elementary school on its first five floors. It is among the tallest residential buildings in the Western Hemisphere.
The skyscraper was refinanced in 2014 with a $550 million commercial mortgage-backed securities loan from the city’s Housing Development Corporation. That same year, the property was appraised at $1.1 billion. The CMBS loan refinanced floating-rate bonds issued between 2008 and 2010 that included Liberty Bonds.

Brookfield Asset Management acquired Forest City Ratner in December 2018, giving the investment giant control of the distinctive skyscraper.
But since the coronavirus hit, occupancy has nosedived. As a result, the $550 million loan tied to the property is now on Trepp’s watchlist. Brookfield, however, has not missed any of the loan payments.

The luxury apartments appealed to high earners in the Financial District. But since mid-March, the area has been almost a ghost town as employees work remotely. Only about 13 percent of New York workers are back in the office, and roughly 500,000 residents skipped town. No borough cleared out more than Manhattan.

Brookfield and its affiliates are among the largest office landlords in New York with properties that include Brookfield Place and One Manhattan West. During the pandemic, the investment firm has emerged as a contrarian on the future of New York’s office market. In June, Brookfield Property Partners CEO Brian Kingston told The Real Deal he did not see working from home “as an existential threat” to office properties.

A spokesperson for Brookfield did not immediately return a request for comment.
 
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