NY’s Rapid Rent Growth Coming to End

New York City’s nearly two years of rampant rent growth appears to be over.

Manhattan’s median rent slipped in September to $4,350. The month-over-month decline was 1.15 percent, according to a report by appraisal firm Miller Samuel for Douglas Elliman.

But coupled with a drop in new leases and a rising vacancy rate, the price decline suggests rapid rent gains are in the rearview mirror, report author Jonathan Miller said.

Tenants signed the fewest number of new leases since May, opting instead to renew where they were. Renters in non-doorman buildings, which generally have cheaper rents, drove that trend, changing addresses at a “substantially lower” rate than before the pandemic, according to Miller.

The changes signal that rents hit an affordability threshold, particularly for lower-income tenants. Manhattan’s vacancy rate ticked above 3 percent for the first time in over three years.

New York’s wealthy also pulled back from the rental market.

After six straight months of annualized increases, the median rent for a luxury apartment fell 4 percent year-over-year to $11,013 in September. The decline from August was 11 percent. Meanwhile, the number of luxury listings grew annually for the first time in nine months.

Brooklyn and Queens shadowed Manhattan’s declining demand. In both boroughs, rents fell from this summer’s records, the number of new lease signings declined and listing inventory ticked up from a year ago for the first time in a few months.

What’s yet to be seen is whether prices continue to ebb this winter or hold steady.

If seasonal patterns — which were disrupted by the pandemic — return, apartment demand will subside until spring, possibly bringing rents down as well.