This is a great time to be alive—if you've been spending a ton of money on rent for an apartment in a not-luxury building and have been dreaming of spending a similarly large amount of money for an apartment in a luxury building. What's this all mean?
According to online real estate firm RentHop, the higher end of New York's rental market, particularly the Manhattan market, has softened to the extent that one-bedroom rents in luxury buildings are often approaching parity with those of commoner buildings. In some areas, like glamorously desolate DUMBO, RentHop found median non-luxury unit rents now actually exceed rents for comparable luxury units.
RentHop made a map of its findings, which gives a sense of price trends for the luxury and non-luxury markets.
The enormous boom in luxury units (defined as units in a building with a doorman or gym—rather generous categories, I know) over the past few years has saturated the market in many neighborhoods, and real estate watchers have been reporting since this past summer that the tide has started to turn toward renters. Landlords are cutting rents and offering one and two months free rent and other similar teasers to lure folks in, whereas a few years ago they would have asked you to put down your first born as a security deposit.
RentHop found that rent for luxury one bedrooms dropped in 24 neighborhoods (and only increased in 11) across the city. Meanwhile, rents in the non-luxury market increased in 46 neighborhoods and decreased in 34.
Non-luxury unit prices dropped almost five percent in Manhattan, while they were up across the other boroughs. Perhaps unsurprisingly, rents for non-luxury (a.k.a., your building) units in Brooklyn soared, increasing almost 10 percent from last year. Note the sea of red, i.e., increases, across central and south Brooklyn, northeastern Queens, and Upper Manhattan/the southern Bronx. The pain you're feeling in your pocket is real.
The biggest drop in luxury pricing was in West Harlem, where rents fell 14 percent from last year to $2,375 for a one-bedroom. (Non-luxury buildings in the area were up 11 percent to $2,100, significantly closing the price gap.)
Meanwhile, the largest increase in luxury apartment price came across the island, with median rents in East Harlem up 20 percent up to $2,350. RentHop credited the new Second Avenue Subway for making the area more attractive to renters.
Stay tuned. We're only on thesecond or third seal at the moment. If we start to get toward five or six, it's really going to be a renters' market.