Market

Is new construction driving rents up in Brooklyn’s outlying neighborhoods?

Photo: Robert Clark

New Yorkers got some relief in February with rents remaining mostly stagnant citywide.

And despite rents remaining mostly flat citywide, a surge in new construction in Brooklyn’s inner neighborhoods is driving up rents in these areas at a quicker pace than the borough’s trendier neighborhoods, according to a report released yesterday by New York brokerage MNS.

The average Brooklyn rent inched up 0.42 percent annually to $2,755.82 in February. Rents were also up 1.36 percent from the previous month.

Nearly all Brooklyn neighborhoods recorded monthly rental price growth in February. Interestingly, more “established” neighborhoods like Williamsburg and Park Slope recorded slower-than-expected price growth, while more up-and-coming areas like Bushwick continued to see gains — Bushwick studio rents grew over 10 percent annually.

“This can be explained by increased development in these neighborhoods, along with preferable rents, which, in conjunction, lead some renters to move out further into Brooklyn,” says MNS.

The increase in new construction activity is a “good sign” for the Brooklyn rental market, with average rents still mostly up.

The most expensive apartments were all in DUMBO in February, while the least expensive were found in Bay Ridge.

Closing out the first quarter, MNS expects average Brooklyn rents to remain “stable.”

Meantime, over the last year, average Manhattan rents rose 0.44 percent to $3,903.80 in February. Manhattan rents were up 0.24 percent from the previous month.

The most impressive year-over-year price change was recorded within doorman studio pricing in the Lower East Side neighborhood, where rents increased 17.4 percent from the previous month in February. This was attributable to a surge in new development activity in the neighborhood, which exerts upward pressure on pricing.

On the flipside, non-doorman one-bedroom units in Tribeca recorded the most substantial decline in February, plummeting 12.8 percent from the previous month to $4,428. Yet, despite the steep decline, non-doorman one-bedroom units were the most expensive in Tribeca boroughwide in February.

Looking ahead, Manhattan renters are likely in for more of the same in March.

“Going into the last month of the first quarter for 2018, rental prices in Manhattan can be expected to remain relatively stable, or go down slightly,” says MNS in the digital release.

Click here to read the entire report.

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