June 9, 2010
By Dawn Wotapka in The Wall Street Journal
Manhattan’s vacancy rate fell again in May, dipping below 1% for the first time in nearly three years, leaving little supply available during the peak leasing season.
That’s quite the turnaround from a year or two ago, when apartments were plentiful and desperate landlords coughed up free rent and paid the broker fee–typically a month of rent–to fill units. These days, potential renters scouting potential addresses better bring their checkbooks: Apartments aren’t staying empty for long and many landlords are done ponying up the broker fee.
“Despite all the lunacy that that’s prevailing in the national economic situation, the rental market here in Manhattan is booming,” says Gary Malin, president of brokerage Citi Habitats.
May’s vacancy rate came in at .98%, down from 1.72% a year earlier. The rate has been falling steadily since November, when it peaked at 1.87%, Citi Habitats reports. The West Village boasts the tightest vacancy, a scant .33% of those units are up for grabs. The Upper East Side is the weakest, albeit with just 1.47%. Compare that with the national 8% rate.
Big Apple renters are also paying more: The average rent for a one bedroom, a big percentage of the local supply, climbed 3% from a month earlier to $2,453. Two-bedroom units saw the same percentage gain, averaging $3,414.
For one bedrooms, SoHo/TriBeCa saw the priciest monthly rent: $3,383. That makes Harlem a steal at $1,450. Washington Heights claims an even lower monthly tab: $1,306.