Manhattan Apartment Rents Slide After Exodus Empties Buildings

Manhattans rental market is starting to show the damage from a pandemic-fueled exodus.

The boroughs apartment-vacancy rate in June rose to the highest on record. Available listings surged 85% from a year earlier to 10,789 -- an all-time high for a single month, appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate said in a report Thursday.

All that inventory put a dent in pricing. The median rent slid 6.6% to $3,242, the first decline in 18 months and the biggest in data going back to October 2011, according to Jonathan Miller, president of Miller Samuel.

Rental Retreat

Manhattan apartment-leasing costs fell for the first time in 18 months

Source: Miller Samuel Inc. and Douglas Elliman Real Estate

“It does give context to the scale of the movement out of Manhattan during the crisis,” Miller said in an interview.

Many New Yorkers lost their taste for dense city living while the coronavirus raged, shuttering office buildings and giving people few reasons to stick around. Apartments vacated during the three-month lockdown were heaped onto the market at the end of June, when the state lifted the ban on in-person real estate showings.

Leaping Listings

Manhattan's apartment inventory soared as the lockdown lifted

Source: Miller Samuel Inc. and Douglas Elliman Real Estate

New lease signings jumped 45% last month from May, with 3,171 apartments finding takers, Miller Samuel and Douglas Elliman said.

To get those tenants, landlords had to offer average rent discounts of 2%, more than double what they were giving last year. They also piled on sweeteners, such as free months and payment of broker fees, in 45% of deals.

Still, the vacancy rate climbed to 3.67%, a record in data going back to August 2006. The rate had never before topped 3%, according to Miller.

“Were in for a summer season that is going to be all about supply,” he said.