Manhattan Rental Market Report

Updated: May 2009

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Table of Contents:

• Letter From Our Chief Operating Officer
• A Quick Look
• Mean Manhattan Rental Prices
• Manhattan 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

   

• Appendix A
• 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 2009 edition of our Manhattan Rental Market Report, the only research on the city’s rental rates published on a monthly basis.

May marks the official start to the summer seasonality in Manhattan’s rental market. Keeping in line with this trend, we have witnessed that rental demand has been steadily increasing week-over-week since the beginning of April. Our firm has seen an increase of approximately 33% in rental deals this April compared to April of 2008 — when the market was at its apparent peak. So, it’s clear to us that consumer demand is back.

While we, as well as many others in the industry, are excited about this development, our experience has taught us that demand tends to ebb and flow with a greater deviation than the market itself. While we have seen some owners realize the increase in demand and begin to test the market, we are concerned that, as what happened last summer, owners that are too aggressive to raise prices or slash incentives will find themselves holding excess inventory going into the fall.

In fact, the news from our consumer base is not as optimistic as the demand numbers indicate. Many potential renters have told us that the issues with securing employment in Manhattan have not subsided and while many new grads are looking for housing in the city, a great deal of them are doing so without employment or with start dates that have been pushed back.

Also, taking a broader perspective on the data, it appears that Manhattan did not just lose two years of growth, but actually fell significantly below those numbers overall. Doorman units are down 6.92% and non-doorman units are down 3.62% since May of 2007. Some of the greatest decreases were in Midtown East doorman studio units (down 20.69%), Murray Hill non-doorman one-bedroom units (down 20.71%), East Village doorman one-bedroom units (down 18.44%), Midtown West non-doorman two-bedroom units (down 20.42%), Gramercy Park non-doorman two-bedroom units (down 20.25%) and Midtown East doorman two-bedroom units (down 21.33%). It is also important to note that these numbers do not take into consideration concessions or OPs, which would most likely make the net effective numbers even greater. [See Appendix A]

The bottom line this month is that while the market appears to be picking up, it doesn’t yet appear that the market has recovered.

Daniel Baum, C.O.O.

The Real Estate Group

A Quick Look

Non–doorman Buildings (Average Prices)
	Most Expensive	Least Expensive
Studios	TriBeCa $3,283	Harlem $1,277
One–bedrooms	TriBeCa $3,901	Harlem $1,611
Two–bedrooms	TriBeCa $7,145	Harlem $2,073

 

Doorman Buildings (Average Prices)
	Most Expensive	Least Expensive
Studios	SoHo $2,742	Harlem $1,383
One–bedrooms	SoHo $4,246	Harlem $1,927
Two–bedrooms	TriBeCa $6,910	Harlem $2,956

Greatest Changes Since April:

• Non–doorman studios – TriBeCa – Up 8.71% ($263)
• Non–doorman one–bedrooms – TriBeCa – Down 9.37% ($403)
• Non–doorman two–bedroom – Financial District – Up 9.27% ($343)

• Doorman studios – Chelsea – Up 7.82% ($182)
• Doorman one–bedrooms – SoHo – Down 8.29% ($384)
• Doorman two–bedroom – Lower East Side – Up 9.08% ($376)

Year-over-year Changes:

Non–doorman Citywide Rents: May ’08 vs. May ’09
	May ’08	May ’09	Change
Studios	$2,062	$1,974	-4.27%
One–bedrooms	$2,803	$2,605	-7.06%
Two–bedrooms	$3,941	$3,705	-5.99%

 

Doorman Citywide Rents: May ’08 vs. May ’09
	May ’08	May ’09	Change
Studios	$2,587	$2,332	-9.84%
One–bedrooms	$3,624	$3,299	-8.96%
Two–bedrooms	$5,354	$5,112	-4.53%

Notable Trends:

Prices remain stable — Rents across the city continue to hold this month vs. last month. The greatest change was in non-doorman studios, which rose 1.85%. However, year-over-year comparisons remain down. The greatest change was in doorman studios which are down 9.84% since May 2008.

Doorman units continue to decline — Vacancies are down 2.11% this month in doorman units while non-doorman units continue to increase, rising this month 3.76%. This marks the sixth straight month of vacancy increases for non-doorman units. So while prices appear to be stable, the market may force even further non-doorman decreases in order to compete with their doorman counter-parts.

Impact of decline proves significant — The Manhattan Rental Market decline has had significant effect on prices. In fact, current prices are even lagging 2007 numbers. Non-doorman units are down 3.62% and doorman units are down 6.92% from May of 2007.

Where Prices Decreased:

Harlem—Non-doorman studios (-1.38%), non-doorman one-bedrooms (-2.68%), non-doorman two-bedrooms (-0.19%)

Upper West Side—Doorman studios (-2.77%), non-doorman one-bedrooms (-0.35%), doorman one-bedrooms (-0.08%)

Upper East Side—Non-doorman studios (-0.74%), non-doorman one-bedrooms (-1.56%), doorman one-bedrooms (-1.92%), non-doorman two-bedrooms (-3.65%), doorman two-bedrooms (-1.70%)

Midtown West—Non-doorman one-bedrooms (-0.03%), non-doorman two-bedrooms (-4.63%)

Midtown East—Non-doorman studios (-1.61%), doorman studios (-0.99%), non-doorman two-bedrooms (-6.88%), doorman two-bedrooms (-3.34%)

Murray Hill—Doorman studios (-2.06%), non-doorman one-bedrooms (-1.66%), doorman one-bedrooms (-0.21%), doorman two-bedrooms (-1.28%)

Chelsea—Non-doorman studios (-7.22%), doorman one-bedrooms (-0.45%), non-doorman two-bedrooms (-8.64%), doorman two-bedrooms (-1.04%)

Gramercy Park—Non-doorman two-bedrooms (-7.60%), doorman two-bedrooms (-0.27%)

Greenwich Village—Doorman studios (-0.43%), doorman two-bedrooms (-1.25%)

East Village—Non-doorman two-bedrooms (-0.88%), doorman two-bedrooms (-8.19%)

SoHo—Doorman one-bedrooms (-8.29%), non-doorman two-bedrooms (-2.11%)

Lower East Side—Non-doorman one-bedrooms (-0.21%)

TriBeCa—Doorman studios (-0.87%), non-doorman one-bedrooms (-9.37%), doorman one-bedrooms (-2.21%), doorman two-bedrooms (-3.30%)

Battery Park City—Doorman studios (-4.12%), doorman one-bedrooms (-3.08%)

Where Prices Increased:

Harlem—Doorman studios (4.34%), doorman one-bedrooms (0.57%), doorman two-bedrooms (1.65%)

Upper West Side—Non-doorman studios (1.37%), non-doorman two-bedrooms (4.15%), doorman two-bedrooms (2.78%)

Upper East Side—Doorman studios (0.39%)

Midtown West—Non-doorman studios (2.98%), doorman studios (2.84%), doorman one-bedrooms (0.21%), doorman two-bedrooms (3.00%)

Midtown East—Non-doorman one-bedrooms (3.49%), doorman one-bedrooms (0.75%)

Murray Hill—Non-doorman studios (2.21%), non-doorman two-bedrooms (1.55%)

Chelsea—Doorman studios (7.82%), non-doorman one-bedrooms (3.40%)

Gramercy Park—Non-doorman studios (0.08%), doorman studios (7.62%), non-doorman one-bedrooms (4.19%), doorman one-bedrooms (5.54%)

Greenwich Village—Non-doorman studios (0.79%), non-doorman one-bedrooms (7.62%), doorman one-bedrooms (0.17%), non-doorman two-bedrooms (7.21%)

East Village—Non-doorman studios (0.97%), doorman studios (1.67%), non-doorman one-bedrooms (0.88%), doorman one-bedrooms (0.88%)

SoHo—Non-doorman studios (1.60%), doorman studios (1.03%), non-doorman one-bedrooms (0.44%), doorman two-bedrooms (0.67%)

Lower East Side—Non-doorman studios (8.46%), doorman studios (4.47%), doorman one-bedrooms (3.72%), non-doorman two-bedrooms (3.60%), doorman two-bedrooms (9.08%)

TriBeCa—Non-doorman studios (8.71%), non-doorman two-bedrooms (4.79%)

Financial District—Non-doorman studios (6.00%), doorman studios (2.37%), non-doorman one-bedrooms (6.20%), doorman one-bedrooms (1.89%), non-doorman two-bedrooms (9.27%), doorman two-bedrooms (0.58%)

Battery Park City—Doorman two-bedrooms (2.02%)

Tips for Renters:

• Upper East Side a non-doorman renter’s dream. If you’re in the market for a non-doorman deal, there is no better neighborhood this month than the Upper East Side. Grab a studio, one-bedroom or two-bedroom unit, all at their 13-month lowest price point.
• Harlem can’t be beat. It was already difficult to for the rest of Manhattan to compete with Harlem non-doorman one-bedroom prices, but since they tumbled this month an additional 1.38%, they are now at their lowest point since The Real Estate Group began reporting data for this units over a year ago. So if you are looking to move into Manhattan, these units are a great place to start.
• Head to the East Village for service and space. If you are looking for a doorman two-bedroom unit, grab the 6 to Astor Place and start your search. East Village doorman two-bedroom units fell 8.19% this month, putting them at their 13-month lowest point and making them the second lowest neighborhood in their category.

Mean Manhattan 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 2009. Graphs tracking citywide and neighborhood price changes over a rolling 13-month period follow.

Manhattan 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

Appendix A

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.

If you would like to republish this report on the web, please be sure to source it as the “Manhattan Rental Market Report” with a link back to its original location (http://www.tregny.com/manhattan-apt-rental-report.jsp).