The nation's priciest apartment rental market became more expensive in the first quarter, with the average apartment renting in New York City's borough of Manhattan for a record high in March at $3,418, according to new data from Citi Habits. This is the highest rental price recorded since the company began tracking this statistic in January 2002. The previous record was set in May 2007, when the average was $3,394.
Citi Habits reports that the largest Manhattan rent increases occurred for one-bedroom apartments, where the average rental price increased 6.5% over the past year. For studio, two- and three-bedroom apartments, rents increased 3.6%, 6.1% and 4%, respectively. Rents also increased across the board slightly during the first quarter of this year versus the fourth quarter of 2011.
‘The Manhattan rental market entered spring even hotter than a Mariano Rivera fastball,’ says Guy Malin, president of Citi Habits. ‘During this period, landlords remained firmly in control, and from an apartment seeker's perspective, the competition to secure an apartment was increasingly intense. Average rents were up across all apartment categories when comparing the first quarter of 2012 to the same period in 2011.’
However, Malin stresses that the rental market has changed substantially over five years.
"In 2007, the rental price run-up was due in part to a relatively strong economy and robust hiring in the tech sector and beyond," he says. "Fast-forward to 2012, and Manhattan rents – as well as those around the country – are rising rapidly due in part to the public's uncertainty about the housing market. In some cases, current tenants' inability to qualify for a mortgage under tightened requirements is making them renters not by choice, but by necessity."
Malin adds that while rents have reached a new high, Manhattan's vacancy rate remains relatively stable: The overall rate for the first quarter was 1.22% when compared to 1.08% a year prior.