The rental market in New York City is bouncing back from the pandemic slump, but not in favor of the renters. According to the latest reports from real estate firms, the median rent in Manhattan reached $3,150 in August 2021, up 7.8% from a year ago. The vacancy rate dropped to 3.23%, the lowest since February 2020. The number of new leases signed soared by 111.4%, indicating a strong demand.
The same trends are observed in Brooklyn and Queens, where the median rents rose by 11.6% and 9.4%, respectively. The vacancy rates fell to 2.5% and 2.8%, respectively. The number of new leases signed increased by 75.9% and 86.6%, respectively.
The rebound of the rental market is driven by several factors, such as the reopening of the city, the return of workers and students, the availability of vaccines, and the expiration of eviction moratoriums. Many renters who left the city during the pandemic are coming back, while others are taking advantage of the incentives and discounts offered by landlords.
The challenges for the renters
However, the recovery of the rental market also poses challenges for the renters, who have to deal with rising costs and fierce competition. Many renters are facing rent hikes, bidding wars, and limited choices.
According to a survey by StreetEasy, 40% of NYC renters who moved in the past year paid more than they expected for their new apartment. The survey also found that 44% of renters had to compromise on their preferred location, size, or amenities. Moreover, 35% of renters experienced a bidding war, where they had to offer more than the asking price or waive some conditions to secure a lease.
Some renters are resorting to desperate measures to find an affordable and decent apartment in the city. For instance, some renters are using fake pay stubs, fake references, or fake guarantors to qualify for apartments that are out of their budget. Others are signing leases without seeing the apartments in person, only to discover hidden problems or scams later.
The outlook for the future
The outlook for the rental market in NYC is uncertain, as it depends on various factors, such as the course of the pandemic, the economic recovery, the supply and demand balance, and the policy interventions.
Some experts predict that the rental market will continue to grow in the coming months, as more people return to the city and seek longer-term leases. They also expect that the landlords will reduce or eliminate the incentives and discounts that they offered during the pandemic slump.
However, some experts warn that the rental market could face a slowdown or a correction if the pandemic worsens, the unemployment rate rises, or the eviction crisis escalates. They also suggest that the city and state governments should provide more assistance and protection to the renters who are struggling to pay their rent or facing displacement.
