For the first time in two years, rents in Manhattan actually got cheaper.
The median rental price in New York City’s most expensive borough dropped 2.8% to $3,300 in March from the same time a year ago.
This is the first annual decline in 24 months, according to the latest report by real estate appraisal firm Miller Samuel for Douglas Elliman Real Estate.
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“The rental market is sitting within the city’s robust economy so that drives demand,” said Jonathan Miller, CEO of appraiser firm Miller Samuel. “But there has been this disconnect with the type of housing we are bringing to market and the wages that are being paid.”
The rental market has been tapping the brakes since August, but Miller doesn’t expect rents to continue to decline.
“We will see this up and down pattern, which is going to be the equivalent to moving sideways,” said Miller.
But here’s some more good news for renters: It’s also getting easier to find an apartment in Manhattan with the vacancy rate rising to 2.4% in March from 1.99% a year ago.
Landlords are offering more concessions — like a month of free rent — to help attract tenants.
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The top-end of the market is showing the most weakness. Rent for Manhattan’s most expensive apartments made the steepest drop of 3.5%.
Developers have been focusing on building high-end apartments to help bolster their profit margins as the cost of land on the island soars.
Renters have been fleeing Manhattan in search of cheaper housing, which has pushed rent prices up in the other boroughs and increased home sales in nearby suburbs.
The number of new leases soared almost 37% in Brooklyn as the median rent jumped 2.7% to $2,775 last month.