Manhattan Rental Market Report

Updated: May 2008

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Table of Contents:

• Letter From Our Chief Operating Officer
• A Quick Look
• Mean Citywide Rental Prices
• Citywide Price Trends
• Neighborhood Price Trends
  • Upper West Side
  • Upper East Side
  • Midtown West
  • Midtown East
  • Murray Hill
  • Chelsea
  • Gramercy Park
  • Greenwich Village
  • East Village
  • SoHo
  • Lower East Side
  • TriBeCa
  • Financial District
  • Battery Park City
  • Harlem
• The Report Explained

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Letter From Our Chief Operating Officer

On behalf of The Real Estate Group, I am pleased to present the May 2008 edition of our Manhattan Rental Market Report, the only research on the city’s rental rates published on a monthly basis.

In a continuation of the growth we saw last month, the majority of citywide rents are up compared to May of last year, as well as from April ’08, and it appears that this year’s peak rental season is off to a solid start. Prices increased in every sector of the market from this time last year except for doorman two-bedrooms, and though they’re not commanding the same rents as they were then, an overall comparison of year-over-year rental prices shows that the Manhattan rental market is still extremely healthy. From last month, prices increased across the board with the exception of doorman one-bedrooms, which decreased only marginally. In fact, there were no drastic changes to note, which comes as no surprise if you’ve been keeping up with our data and observations about the rental market each month. All in all, we’ve seen nothing out of the norm in May, which we’re excited about as we anticipate a productive summer for all.

I am glad to see more inventory available for our clients, whereas, in years past, that may not have been the case, and renters may not have been able to find exactly what they were looking for. With the steady pace at which rents have been rising, we expect there should be no problems moving properties in this healthy economic climate. There are pockets of opportunity for both landlords and renters, as the former may be able to increase prices where occasions present themselves and the latter may be able to find housing deals in spite of escalating rents. The greatest year-over-year increase was 4.5% in non-doorman studios, which is right on par with standards of rent stabilization and comes as a welcome change over the 10%–15% price jumps witnessed in years past. That being said, the 2008 busy season has positive beginnings, though only time will tell whether or not the demand for rentals in Manhattan will be able to keep pace with the supply.

Sincerely,

Daniel Baum, C.O.O.
The Real Estate Group

A Quick Look

Non-Doorman Buildings (Average Prices)
	Most Expensive	Least Expensive
Studios	TriBeCa $2,725	Harlem $1,251
One-Bedrooms	TriBeCa $4,217	Harlem $1,648
Two-Bedrooms	TriBeCa $7,145	Harlem $2,280

Doorman Buildings (Average Prices)
	Most Expensive	Least Expensive
Studios	Gramercy Park $2,888	Harlem $1,317
One-Bedrooms	SoHo $4,464	Harlem $1,756
Two-Bedrooms	SoHo $6,924	Harlem $2,574

Greatest changes since April:

• Doorman studios – Midtown West – Up 6.4% ($159)
• Doorman one-bedrooms – Lower East Side – Up 6.6% ($254)
• Doorman two-bedrooms – Lower East Side – Up 7.0% ($317)

• Non-doorman studios – East Village – Up 5.8% ($112)
• Non-doorman one-bedrooms – Midtown East – Up 7.6% ($204)
• Non-doorman two-bedrooms – Upper West Side – Up 4.6% ($144); Upper East Side – Up 4.6% ($146)

Notable Trends:

Demand heightens in Midtown for all non-doorman units, as well as studios in both service categories—Last month, studio rents in Midtown West and Midtown East decreased, making middle Manhattan a viable option for recent grads and new hires looking for affordable housing. This month, however, prices are on the upswing, suggesting that renters are quickly taking advantage of Midtown’s moderate prices and snatching up available units as the rush hits. Apartments in this area may no longer be a steal, but remain less expensive than those in many other neighborhoods for the time being.

Doorman one- and two-bedroom rents on the Lower East Side become increasingly more expensive as the area gains recognition as a luxury neighborhood—With two of the most pronounced price hikes this month, Lower East Side doorman one- and two-bedrooms have attained their highest average rents ever. One-bedrooms have surpassed the $4,000 mark, making them second only to SoHo as the most expensive in the city, though this is more a reflection of the new luxury developments currently on the market than a surge in prices overall. Still, with these posh pads skewing and influencing rents in the area, housing deals may become that much more difficult to come by.

The approaching peak rental season continues to show promise with increased citywide rents from last month and the previous year—Rental prices have persisted in their upward trend from April, even if only modestly, in all apartment sizes and service categories except for doorman one-bedrooms, the rents of which decreased by a negligible 0.1%. In a year-over-year comparison, prices have risen moderately and by as much as 4.5% in non-doorman studios. Doorman two-bedrooms were the only exception, with rents decreasing by 2.2%. This indicates that, despite a substantial increase in the city’s housing inventory, the Manhattan rental market is still experiencing its usual growth for this time of year, though perhaps not as dramatically as before.

Non-Doorman Citywide Rents: May ’07 vs. May ’08
	May ’07	May ’08	Change
Studios	$2,033	$2,125	+4.5%
One-Bedrooms	$2,852	$2,892	+1.4%
Two-Bedrooms	$3,978	$4,069	+2.3%

Doorman Citywide Rents: May ’07 vs. May ’08
	May ’07	May ’08	Change
Studios	$2,586	$2,677	+3.5%
One-Bedrooms	$3,690	$3,757	+1.8%
Two-Bedrooms	$5,678	$5,552	-2.2%

Where Prices Decreased:

Harlem—All Harlem rents decreased with the exception of non-doorman two-bedrooms, most significantly in non-doorman one-bedrooms (by 3.5%) and doorman two-bedrooms (by 2%).

Upper West Side—Studio prices crept downward (by 1.1% for non-doorman units and 1.3% for doorman units), as did rents for doorman two-bedrooms (by 0.1%).

Upper East Side—Doorman studio and non-doorman one-bedroom prices slipped by 1.0% and 1.1%, respectively.

Midtown West—Doorman one-bedrooms saw a price cut of 4.8%, while doorman two-bedroom rents softened by a mere 0.1%.

Midtown East—Doorman one- and two-bedroom rents fell by 3.6% and 2.5%, respectively.

Murray Hill—Studio prices decreased in both service levels (by as much as 3.2% for doorman units), and doorman one-bedrooms lowered 1.9%.

Chelsea—Studio and one-bedroom rents in the doorman category went down modestly by less than 1% each.

Gramercy Park—Prices for all non-doorman units dipped (by 1.7% for studios, 1.4% for one-bedrooms and 1.2% for two-bedrooms), and doorman two-bedroom prices dropped by 2.2%.

Greenwich Village—Doorman studio rents nudged downward by 0.2%, doorman one-bedrooms by a more substantial 3.6% and non-doorman two-bedrooms by 0.1%.

East Village—Doorman one-bedrooms saw prices lower by 2.6%, while two-bedrooms across both service levels decreased, by 3.5% for non-doorman units and 1.3% for doorman units.

SoHo—All non-doorman apartment rents decreased marginally (by 0.9% for studios, 1% for one-bedrooms and 1.8% for two-bedrooms).

TriBeCa—Prices for every apartment size and service category fell except for doorman two-bedrooms, with the most significant price cuts in non-doorman one-bedrooms (by 4.8%) and doorman two-bedrooms (by 3.8%).

Financial District—Non-doorman studio rents dropped by 2.3%, doorman one-bedroom rents by 0.5% and non-doorman two-bedroom rents by 0.4%.

Battery Park City—All doorman rents went down, by 4.6%, 0.4% and 1.2% for studios, one-bedrooms and two-bedrooms, respectively.

Where Prices Increased:

Upper West Side—Rents across both service categories of UWS one-bedrooms increased (by 2.4% for non-doorman units and 2.5% for doorman units); additionally, non-doorman two-bedroom prices went up by 4.6%.

Upper East Side—Tied with the Upper West Side for most notable increase in non-doorman two-bedrooms, rents in that category rose by 4.6% while doorman one- and two-bedroom prices experienced boosts of 0.6% and 3.2%, respectively. Non-doorman studio rents inched upward by 0.7%, as well.

Midtown West—All non-doorman units went up in price, by 5.5% for studios, 1.1% for one-bedrooms and 4.4% for two-bedrooms. Midtown West also bore the most remarkable upsurge in doorman studio prices at 6.4%.

Midtown East—Midtown East price trends were identical to those of its western counterpart this month, with rents growing across the board for all non-doorman apartments (by 4.6%, 7.6% and 3.7% for studios, one-bedrooms and two-bedrooms, respectively) and doorman studios (by 4.7%).

Murray Hill—All two-bedroom rents moved upward this month, most notably by 3.8% in the non-doorman category. Non-doorman one-bedroom rents also saw a slight increase of 0.2%.

Greenwich Village—Non-doorman studio prices went up by 5%, non-doorman one-bedrooms by 1.6% and doorman two-bedrooms by 3.5%.

East Village—All East Village studios rose in price (by 5.8% for non-doorman units and 3.5% for doorman units), as did non-doorman one-bedrooms (by 0.5%).

SoHo—All doorman rents went up, by 4.4%, 2.3% and 2% for studios, one-bedrooms and two-bedrooms, respectively.

Lower East Side—Studios in both service levels increased in price by 3.4% for non-doorman units and 1.3% for doorman units, while doorman one- and two-bedrooms experienced some of the most significant increases in the city by 6.6% and 7%, respectively.

Financial District—Prices increased incrementally for doorman studios (by 1.7%), non-doorman one-bedrooms (by 1.5%) and doorman two-bedrooms (by 0.6%).

Tips for Renters:

• Amidst the city’s rising prices, Harlem still houses some of Manhattan’s best deals. Home prices in this northern neighborhood have always been highly desirable, but may be more so now that rents in the city’s other areas are getting steeper. Harlem rents have decreased in every size and service category besides non-doorman two-bedrooms this month, so if you’re on the hunt for a sizeable apartment at a bargain price, we suggest you look here first.
• Renters looking for housing in TriBeCa and SoHo now have the opportunity to rent their coveted units for less. Non-doorman rents in TriBeCa and SoHo decreased across the board in May, by as much as 4.8% in TriBeCa non-doorman one-bedrooms. While these exclusive apartments have always been and probably always will be on the pricier side, those willing to spend the cash can shave a couple hundred dollars off their monthly rent if they act now.
• If it’s full-service luxury in a downtown locale you want, Battery Park City may have what you seek. This month, all BPC rents dropped, with the most significant change in doorman studios (by 4.6%). Rents in this neighborhood had been on the rise since February and March, so for those yearning for the area’s abundance of amenities and easy accessibility to some of the city’s best parks, the Financial District and TriBeCa’s lively social scene, this decrease in prices may be just what they’ve been waiting for.

Mean Citywide Rental Prices

The Mean Rental Price graphs illustrate average monthly rents for studios, one-bedrooms and two-bedrooms in doorman and non-doorman buildings in Manhattan for the month of May 2008. Graphs tracking citywide and neighborhood price changes over a rolling 12-month period follow.

Citywide Price Trends

*2008 data includes Harlem

Neighborhood Price Trends

Upper West Side

Upper East Side

Midtown West

Midtown East

Murray Hill

Chelsea

Gramercy Park

Greenwich Village

East Village

SoHo

Lower East Side

TriBeCa

Financial District

Battery Park City

Harlem

As Harlem’s data is new to this report, these graphs only show Harlem rents in 2008 so far.

The Report Explained

The Manhattan Rental Market Report is the only report that compares fluctuation in the city’s rental data on a monthly basis. It is an essential tool for potential renters seeking transparency in the NYC apartment market and a benchmark for landlords to efficiently and fairly adjust individual property rents in Manhattan.

The Manhattan Rental Market Report is based on data cross-sectioned from over 10,000 currently available listings located below 155th Street and priced under $10,000, with ultra-luxury property omitted to obtain a true monthly rental average. Our data is aggregated from the TREGNY proprietary database and sampled from a specific mid-month point to record current rental rates offered by landlords during that particular month. It is then combined with information from the REBNY Real Estate Listings Source (RLS), OnLine Residential (OLR.com) and R.O.L.E.X. (Real Plus).

Contact us now: 212.475.9000

Note: All market data is collected and compiled by The Real Estate Group’s marketing department and is overseen by C.O.O. Daniel Baum. The information presented here are intended for instructive purposes only and has been gathered from sources deemed reliable, though it may be subject to errors, omissions, changes or withdrawal without notice.

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