By Hadassa Kalatizadeh
The Coronavirus pandemic continues to leave its mark on Manhattan real estate. The average Manhattan apartment rent has dropped to below $3,000 for the first time since 2011, as per a Street Easy report. The average rent for a Manhattan apartment is now roughly $2,990, which is 7.8 percent lower than last year, and the lowest in close to a decade. On average, overall rents in NYC have tumbled almost 8% since March.
As reported by MSN Money News, the drops reflect how city residents have been fleeing since the onset of the pandemic. Many have left NYC, breaking their rental agreement and abandoning their security deposits. House prices are dropping as well, with the median price in New York City now at $665,000. In Manhattan the median house price is down to $980,000. In an effort to bring relief to struggling tenants, the state has issued a moratorium making it illegal for residential and commercial tenants to be evicted. This order has added pressure onto landlords to stay afloat, while still responsible to pay taxes, and maintain their properties despite their dwindling rental income.
In an attempt to fill the increasingly vacant apartments, the rental rates have fallen across the boroughs of New York City. In Brooklyn, the average rent is down to $2,599 and in Queens the average has fallen to $2,200. In Downtown Manhattan which is still the most expensive neighborhood in NYC, the median rent is now $3,300, or 15 percent lower than last year. In Midtown Manhattan, the average is now $3,000 a month, a 17 percent drop. The cheapest location to rent in New York City is Bensonhurst, Brooklyn, where rent fell to $1,750. In DUMBO, Brooklyn’s most expensive neighborhood, rents are averaging $4,217.
“I don’t think they can believe this is actually happening. How could I have gotten $5,000 two years ago, and now no one even wants it for $3,500?” Bill Kowalczuk, an associate broker with Warburg Realty, told The New York Times regarding the tumbling prices.
“This is the first of many milestones to come, in terms of Manhattan’s rental market being turned on its head,” said Nancy Wu, a StreetEasy economist. With the pandemic’s end obscure, Gov. Cuomo announced last week that landlords also cannot evict any commercial tenants until 2021. This has led landlords and tenants to try to renegotiate lease agreements, with landlords hoping to get something now and tenants hoping the long term lower price will ultimately benefit them.