Over the past year we’ve seen headlines here and there about small declines in Manhattan prices, or Brooklyn businesses being forced back across the East River in search of cheaper rent, but they’ve generally seemed like blips on the radar, isolated incidents. Not so: a new industry report indicates that “rents have steadily declined” in Manhattan over the past few months, and Coldwell Banker AC Lawrence’s chairman Marc Lewis told the Times, “All of a sudden, in late September, the market just died. There’s been a strong drop-off in demand, and landlords have lost a few months’ rent.” Vacancy rates are also at their highest since 2006.
As such, 30 percent of Manhattan landlords are now offering concessions like a free month’s rent or a waived broker fee, the highest rate of these kinds of offerings since the end of the recession in 2010. The going theory is that after the recent boom—in which rents skyrocketed while salaries, not so much—”the market is correcting itself.”
“The city is not just Wall Street anymore,” said one developer. “It’s become much more diversified. But the bad news is that people in those new industries aren’t making the same kinds of salaries.” One wonders who, exactly, he thinks this is “bad news” for, but point taken.
For what it’s worth, the decline started back in September, so it’d be hasty to lump this in with any sweeping conclusions about #DeBlasio’sNewYork. And anyway, things haven’t gotten that much cheaper—average rents are still higher than they were at this time in 2013, thanks to astronomic growth prior to the slowdown. Plus, the article makes sure to note that whiel all this is going on in Manhattan, Brooklyn rents are “steadily climbing” (studio prices in Fort Greene have gone up 26 percent in the past year, if you needed further evidence). Looks like we might have earned that “New Manhattan” status after all.
Follow Virginia K. Smith on Twitter @vksmith.