Optimism generated by the long-awaited arrival of COVID-19 vaccines may be having a positive effect on the rental market in Manhattan and Brooklyn.
The Corcoran Group recently released our Manhattan and Brooklyn Rental Market Analysis for January 2021. In contrast to recent months, overall Manhattan rents have ticked up, while rents in Brooklyn remain stable. With the roll-out of COVID-19 vaccines, and the potential for a return to in-person work and school for many New Yorkers as 2021 progresses, the city’s rental market may have turned an important corner as we entered the new year.
During the month, Manhattan rents were a mixed bag when compared to December, but rose overall. Pricing for studio and one-bedroom homes both increased 1%, while rents for two-bedroom homes climbed a substantial 18%, due to a marked increase in signed leases in the luxury space. Meanwhile, rents for three-bedroom units declined 16%.
In Brooklyn, January pricing trends also varied by apartment type. The average rent for studio units increased 2% when compared to the preceding month, while it increased 1% for one-bedroom homes over the same period. For two- and three-bedroom apartments, rents declined 1% and 3%, respectively.
The vacancy rate again reversed course in January – falling to 4.74%, after rising to 5.04% in December. However, available inventory remains substantially higher versus the same period last year. In January 2020, 1.31% of apartments were vacant.
Owners’ use of move-in incentives slowed in January 2021. During the month, 48% of rental transactions brokered by The Corcoran Group offered a free month (or more) of rent and/or payment of the broker fee to entice new tenants– down from 53% in December.
Additional relevant findings of the January 2021 Corcoran rental report are outlined below.
- In January 2021, the average monthly rental price for a Manhattan studio was $1,835. For one-bedroom homes, it was $2,655. For two-bedroom units, the average rent was $3,862, and the average three-bedroom apartment rented for $4,899.
Brooklyn studio apartments (in the 14 neighborhoods studied) rented for $2,232 per month on average. For Brooklyn one-bedrooms, the average rent was $2,666 – while rents for two- and three-bedrooms clocked in at $3,017 and $3,279, respectively.
- The most expensive Manhattan neighborhood for renters in January was SoHo/Tribeca with a median rent of $3,800. West Village was the second-priciest area – with a median rent of $3,275.
For Brooklyn, DUMBO was the most expensive neighborhood in January with a median rent of $3,500 – followed by Boerum Hill, which had a median rent of $3,147 per month.
- With a vacancy rate of 3.16%, the Financial District/Battery Park City was the Manhattan neighborhood with the least inventory in January 2021, followed by Midtown West at 3.75%. On the other end of the spectrum, the vacancy rate was highest during the month in the East Village (at 8.91%) and Midtown East (at 8.03%).