Rental activity slowed again in Manhattan and Brooklyn during July, but landlords countered with generous terms and new move-in incentives.
The Corcoran Group recently released our Manhattan and Brooklyn Rental Market Analysis for July 2020.
During the month, Manhattan rents declined year-over-year for most apartment categories. We noted the most dramatic drop in price for studio apartments, where the average rent fell 17% since July 2019. When compared to June 2020 however, rents rose in July for most apartment categories. Instead of lowering prices, many landlords increased their use of move-in incentives and offered more generous terms – including up to three months of free rent. The decline in transaction volume also affected these statistics.
In Brooklyn, leasing activity was comparatively strong. However, rents were down slightly across all apartment categories, both year-over-year and month-over-month. In contrast to Manhattan, larger homes experienced the largest pricing declines. In July 2020, rents for three-bedroom units fell 14% when compared to the same time last year.
The vacancy rate continues to climb to new heights. In July 2020, 3.52% of apartments were vacant, compared to 2.58% in June, and 1.11% in July of last year. Prior to the pandemic, the previous high occurred in February 2009, when the rate reached 2.46%.
When examining concessions, 48% of rental transactions brokered by The Corcoran Group offered a free month’s rent and/or payment of the broker fee to entice new tenants in July 2020 – up from 46% in June.
Additional relevant findings of the July 2020 Corcoran rental report are outlined below.
- In July 2020, the average monthly rental price for a Manhattan studio was $2,082. For one-bedroom homes, the average was $2,914. For two-bedrooms, the average rent was $4,232. Finally, the average three-bedroom apartment rented for $6,520.
Brooklyn studio apartments (in the 14 neighborhoods studied) rented for $2,496 per month on average. For Brooklyn one-bedrooms, the average rent was $2,994 – while rents for two- and three-bedrooms clocked in at $3,959 and $4,655 respectively.
- The most expensive Manhattan neighborhood for renters in July was Chelsea with a median rent of $4,128. Midtown East was the second-priciest area – with a median rent of $3,900. Please note, due to limited activity, SoHo/TriBeCa and The Financial District/Battery Park City were not included in this month’s analysis.
For Brooklyn, DUMBO was the most expensive neighborhood in July with a median rent of $4,240 – followed by Boerum Hill, Brooklyn Heights, and Williamsburg, which all had a median rent of $3,500 per month.
- With a vacancy rate of 2.73%, the Financial District/Battery Park City was the Manhattan neighborhood with the least inventory in July 2020, followed by the Upper East Side at 2.86%. On the other end of the spectrum, the vacancy rate was highest in the East Village (at 6.28%) and Gramercy (at 4.28%).