The New York City rental market is continuing to reel as the state continues to recover from the COVID-19 pandemic.
According to a recent report from StreetEasy, Manhattan rental prices in the second quarter of 2020 are continuing to trend downwards, with the borough seeing a record high for discounts – 34.7 percent of all borough rentals received a discount, which StreetEasys says indicates a sharp reduction in renter demand. Landlords also cut a record 6.7% off the median asking rent in Manhattan, equivalent to $221 per month for the median apartment.
According to StreetEasy’s Manhattan Rent Index, rent prices in the borough fell 0.9% to $3,236 with the priciest 20% of the market seeing a 1.4% decrease in rents, dropping to $6,325. Sales prices also took a hit, dropping down 4.1% from last year to $1,062,276.
On the flip side, Brooklyn’s rental prices saw a slight increase in the second quarter of 2020. According to their findings, median rental prices rose 2.6% to $2,728, the slowest pace of growth since the fourth quarter of 2018. However, 25.6% of rentals were discounted during the second quarter, an increase of 8.6 percentage points year-over-year.
Home prices in Brooklyn dropped 1.6% to $687,160, which is the largest year-over-year drop in home prices in seven years. Brooklyn also had fewer sales inventory, which is down 31.5% year-over-year.
Rents in Queens slowly climbed last quarter at the slowest pace in two years. According to StreetEasy’s Queens Rent Index, median rent prices rose 1.2% to $2,196 during the second quarter with 22.5% of rentals getting discounted – an increase of 4.7 percentage points from last year, and the largest share of discounts since the third quarter of 2018. Home prices in Queens remained flat compared to last year at $507,321.
Due to the pandemic, landlords are starting to see surges in virtual apartment viewings.
“Commuting to the office and living in the center of the city were simply not on the list of priorities for renters during this past quarter, and landlords reacted by slashing rents and trying new tactics in order to attract tenants,” says StreetEasy Economist Nancy Wu. “Landlords are in for a much slower than normal summer rentals season, even as the city slowly begins to reopen. Remote work has given many renters the option to live anywhere they please, making it too soon to predict when rents will rebound.”
Read the full report at streeteasy.com.