Photo: Robert Clark
NYC renters got some relief as 2017 drew to an end. Record numbers of Manhattan and Queens landlords were forced to cut their asking prices in the fourth quarter due to a “typical winter slowdown” in the market.
Brooklyn renters weren’t quite left out in the cold, as near-record numbers of landlords were also forced to cut prices in the fourth quarter, according to a new quarterly report released today by the listing site StreetEasy.
Over the last quarter, the percentage of rentals that received price cuts on their asking price rose to 34 percent in Manhattan and 28 percent in Queens — the highest levels on record for the two boroughs.
Some 57 percent of units in Stuyvesant Town-Peter Cooper Village (Manhattan) saw price cuts — the most cuts recorded boroughwide, while the Corona (Queens) submarket saw 44 percent of its units receive price cuts. A third of the units in the booming Long Island City (Queens) saw price cuts in the fourth quarter.
At the same time, the share of rentals that saw a price cut was up to 28 percent in Brooklyn, just below the record high of 29 percent set in the fourth quarter of 2016.
“While a flood of new construction has been the main driver of the rental market slowdown we’ve witnessed over the last year, the fourth quarter’s rent cuts are more far-reaching than in years past,” says StreetEasy Senior Economist Grant Long in the digital release.
The slowdown is giving NYC renters the most negotiating leverage they’ve had in years. And there is every likelihood that the price cuts will continue in at least part of 2018.
“Rental discounts do have an element of seasonality – and we typically price cuts spike during the end-of-year slow rental season. However, the levels we saw in the fourth quarter went beyond just seasonality swings, signaling a more widespread softening of the market. In 2018, we expect this trend to continue due to a growing pipeline of new construction that promises to keep a lid on future rent increases and will give a negotiating edge to prospective tenants in the coming year,” Long tells BuzzBuzzNews.
Additionally, New Yorkers may have already reached their wallet’s limit as to what they can comfortably afford to pay for housing.
“As the city’s rents outpace wages by a rate of two to one, renters are tapped out on what they’re willing – and able – to pay, and landlords are having to meet renters in the middle and offer more tenable prices,” Long says.
Median rents remained flat in both Manhattan and Brooklyn in the fourth quarter, rising just 0.1 percent to $3,125 in Manhattan and 0.4 percent to $2,524 in Brooklyn.
In Queens, the median rent slid 1.3 percent to $2,066 marking the first annual decline since StreetEasy began tracking the borough in 2011. Of the three boroughs tracked by StreetEasy, Queens recorded the overall strongest price growth in 2017.
Every submarket in each of the three boroughs recorded annual rent growth of less than 2 percent in the fourth quarter. Two submarkets in Queens recorded the steepest annual drops in rent — Northwest Queens, which was down 2.5 percent, to $2,129 and Prospect Park, down 0.9 percent, to $2,619
“The cooling in the market is no longer limited to new, high-end buildings in select pockets of the city — there’s a broader trend of rents topping out across all price points,” Long says in the release.
Click here to read the entire report.