The rock-bottom rental costs New Yorkers enjoyed during Covid are a thing of the past, with prices rebounding to near record levels.
Real estate agents say record demand, sparked by an influx to the Big Apple when lockdown restrictions were lifted, is to blame for the increases. Median monthly rent in Manhattan was nearly $4,100 per month in January, compared with a low of around $2,900 during the pandemic and around $3,500 just before.
But data has emerged suggesting there may not have been an influx at all, and landlords are accused of fabricating demand so they can collect more rent.
An analysis of United States Postal Service data shows there was a net movement of nearly 100,000 people out of New York City last year, in line with what has been seen since around 2017. The trend is supported. by some census estimates, but at odds with jubilant assertions by city officials, analysts and real estate agents that New York City is in the midst of a post-Covid renaissance.
And the owners are not only accused of exaggerating the demand. It is claimed that some have even deliberately kept properties off the market, so it appears that fewer are available, meaning those that are listed may command a higher price.
USPS data for change of address requests, a reliable indicator of how an area’s population is changing, suggests a net outflow of people from New York City, despite claims in the real estate industry of a great demand for properties.
After a dip during the pandemic, rents in New York City hit record levels. The median rental rate for an apartment in Manhattan was $4,097 in January 2023
TO report by Douglas Elliman, one of the city’s largest real estate firms, said median rents in Manhattan were $4,097 as of January 2023, up 15.4 percent year-over-year. It is the third highest rate on record, after a peak in July 2022.
Meanwhile, the vacancy rate in January was 2.52 percent, according to the report, the first time it had fallen in nine months.
Janna Raskopf of Douglas Elliman said CNBC in January that there was a “demand geyser,” adding: “I’ve been doing this for 14 years and it’s unprecedented.” The increase was driven in part by college graduates moving to Manhattan, Raskopf added.
In fact, demand was so high that the record listing prices were just the ‘starting point’, with renters expected to pay more than expected to secure an apartment. A two-bedroom that Raskopf recently listed for a whopping $12,000 a month was visited by 26 prospective tenants, who were expected to offer 15 percent more than the asking price.
But are people really coming back to the city? A report of braking suggests not. Writer Lane Brown did an in-depth analysis of the USPS database of address change requests and found that there actually appeared to be a net outflow.
The net outflow of residents in 2022 was 97,794, the report saidadding that while it’s not a surefire way to estimate relocation trends, it does provide a reliable indicator and also matches census data that shows New York City’s population has been declining since 2016.
The finding contradicts claims by city officials, including former mayor Bill DeBlasio, who left office in December 2021, that New York City’s population was growing. Analysts have also saying New York had “one of the largest declines in the early stage of the pandemic and one of the fastest rebounds.”
Social media sites like TikTok have been abuzz in recent months with posts from potential tenants about the hellishly high prices.
A $1,200-a-month apartment for rent in New York City was compared to a broom closet. It is 9 feet by 6 feet and doesn’t even have its own bathroom or kitchen, they are shared with other occupants of the building.
A modest two-bedroom apartment in Manhattan’s East Village is listed for sale for a staggering $8,000 a month in 2022. Real estate agents say there’s unprecedented demand, but some data suggests more people are leaving New York City of those who are moving there.
The $8,000-a-month East Village apartment features two bedrooms, but one is so small it’s described as ideal as a work-from-home office.
This ‘apartment,’ a room with no private bathroom or kitchen, is listed for $2,000 a month
Examples include a small ‘studio’ resembling a broom closet for $1,200 a month. It’s 9 feet by 6 feet and doesn’t even have its own bathroom or kitchen, which are shared with other tenants on the block.
Another ‘studio’ for $2,000 a month, compared to a ‘prison cell’, also does not include a private kitchen or bathroom.
A modest two-bedroom apartment in the East Village, Manhattan, was priced at $8,000 a month.
Some renters have also been forced to move out of their apartment after their landlords doubled rent costs following cheap deals during Covid. Kelsey Barberio, 27, of New York City, revealed in December that her landlord said her rent would increase from $2,100 to $4,175.
The Cubed article points to the practice of ‘stocking’, in which owners keep some apartments off the market to give the impression of scarcity. Then they charge an inflated rate for the apartments that are available.
A report by Douglas Elliman showed that rental costs in Manhattan were nearly $4,100 a month in January. The number of new leases has increased month-over-month, but it is still much lower than during the pandemic, when many people left the city.
Real estate experts also say rent-controlled apartment owners, who are subject to city-imposed limits on price increases, may also be left empty.
Evan Ruger, a former New York City stockbroker who now runs a real estate firm operating in upstate New York, gave the example of how a landlord might choose not to make essential renovations to a rental apartment. stabilized that it is empty, because the cost will outweigh the gains. to rent it again.
Ruger told DailyMail.com the post-Covid increase in rental prices did not appear to be a “fair reflection” of the current market.
As for whether the rise in rental costs will continue, he said the problem can only be fixed by building more apartment blocks to increase supply.
“It just becomes a question of what beats: Adding more apartments to the market, or how many people are moving to New York, which is less, I think, than in years past,” he said.
‘It sounds crazy, but I really can’t imagine (rents) going down. I think she will stay where she is or increase slightly.
