Craziness in the New York City Rental Marketplace

Folks, I think we’re about to start hearing the terms,”frothy” and “bubbly” again – applied to the Manhattan apartment rental marketplace. Bloomberg New is reporting, and we picked up this reprint in Crain’s New York Business

Manhattan rents rose 9.5% last quarter to an average $3,121, Miller Samuel Inc. and Prudential Douglas Elliman Real Estate said in a report last month. That’s about three times the rate for the 44 largest apartment markets in the U.S., according to Marcus & Millichap, a real estate brokerage firm. Manhattan rental apartment vacancy rates fell to a four-year low of 0.96% last year, down from 1.2% a year earlier and 1.9% in 2009, according to brokerage Citi Habitats. Vacancy bottomed in 2006 at 0.76%.

“The key to the strength of the rental market is tightness of credit,

no fee apartment for rent in new york

No fee apartment for rent in new york. Just about the only way to save money while renting in New York.

” said Jonathan Miller, president of appraiser Miller Samuel. “It takes quadruple-A bizarre credit requirements to get approved.”

I am beginning to see Manhattan apartments for rent at prices  that are very close to their all time highs. There are several reason contributing to this. One is that Wall Street hotshots are getting much smaller bonuses for this past year work. They will probably get similarly small bonuses this year, which means that many of the young masters of the universe will be renting rather than buying.

Another reason is that buying in a New York coop has become extremely difficult. Fannie Mae and Freddie Mac are only insuring loans in New York up to a maximum of $625, 000 – which means that many buyers above that price have to put down much larger down payments, if they can get a loan at all. Manhattan co-op and condominium sales totaled 2,011 in the fourth quarter, 12.4% less a year earlier, according to Miller Samuel and Prudential.

So there are fewer buyer, but more renters who would have normally been buyers. That means that these renters have more money and are fueling the luxury end of the market. The bottom line is high rents in high rise buildings across the prime neighborhoods of Manhattan.
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Written by Lorenzo

Lorenzo has been hanging around the RDNY.com office for the past 20 years, and, in the process, has become the president of RDNY.com, Rent-Direct.com, and Acmelistings.com. His mission is to build RDNY.com into New York's largest no fee apartment rental service. Before RDNY.com, Lorenzo was a Regional Sales Manager for Time Equities, Inc., one of New York's largest converters of rental buildings to coops and condos. Lorenzo was once a part owner of Swift & Watson Real Estate in NYC's Greenwich Village.

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