As some New Yorkers have long left the city and housing advocates fear an eviction crisis, the rental market itself is showing signs of weakening in Manhattan.
A new estimate shows that the median residential rental price in Manhattan dropped 10 percent last month compared to July 2019, according to a report from real estate company Douglas Elliman.
In Manhattan, the median rent for an apartment dropped from $3,521 in July 2019 to $3,167 in July 2020, a decline that the report called "most significant annual decline in almost nine years of record-keeping."
Nonetheless, as one of the priciest places to live in the world, Manhattan is still out of reach for many New Yorkers. The average household income in New York City was less than $61,000, according to the most recent U.S. census.
Consistent with rents falling, the supply of Manhattan apartments has also gone up. The vacancy rate in Manhattan also rose to 4.3 percent, a new record, the report found.
StreetEasy counted 67,348 available rentals in July across the city, compared to 44,245 in July of last year. The Times, which first reported that data, noted the numbers were the highest in a given month since 2010, when the real estate site began tracking such data. In Manhattan, there were 37,195 available rentals, compared to 22,513 in July of last year, according to StreetEasy.
The vacancy rate rise has recently spurred a concern that NYC's rent regulation system is at risk of lapsing—since the lower than market-rate rents are tied to at least a 5 percent vacancy rate.
In a similar dramatic decline, Northwest Queens rents dropped 14.6 percent from $2,837 in July 2019 to $2,424 in July 2020.
Brooklyn rents, however, have dropped only slightly, declining just 1% since July 2019 to a median monthly rent of $2,902 in July 2020.
The median rent prices account for concessions offered by landlords, like the first month's rent free. In Manhattan, for instance, the average number of months' rent owners paid for rose from 1.1 in July 2019 to 1.7 in July 2020.
On Tuesday, when asked about what would happen should the vacancy rate continue to rise, endangering rent stabilized apartments, Mayor Bill de Blasio called the scenario "literally inconceivable to me."
"I think it's a fair question to say, could we be in an unprecedented situation? I think that's a very fair question," the mayor told reporters during a virtual news conference. "I do think rent levels are going to start to go down. I think you're seeing evidence of it already. But it's a fair question, could it be a legal trigger? Even if that is possible, I don't have a doubt in my mind that the Legislature will immediately create continuity with our current approach to rent stabilization and rent control."
Two state lawmakers have introduced a measure to hold off an official vacancy rate count until two years after the COVID-19 emergency to "allow the market to stabilize," as one sponsor, State Senator Brad Hoylman, told THE CITY.
Nancy Wu, an economist for StreetEasy, wrote earlier this month that it wouldn't be surprising to see rents fall even more into spring of next year.
Those "leaving the city are not being replaced by others moving in. The new hires who typically move to the city are starting their jobs remotely. Fewer students will return to the city in September, when colleges in the city, such as Columbia and CUNY, begin the school year teaching most courses remotely," Wu wrote.