In May, the median rent in Manhattan topped $4,000. This is the highest amount that the brokerage Douglas Elliman has ever recorded for the borough. This was a rise of about 2 percent from the previous month of April and an increase of more than 25 percent from the previous month of May 2021. In the month of May, the average cost of a rental apartment in Manhattan was little under $5,000.
In May, the median rental price in Brooklyn reached $3,250, representing an increase of 18 percent compared to the same month the previous year.
After people fled the city in droves and prices dropped during the beginning of the epidemic, residents of New York City have been concerned for months about the city’s skyrocketing rent costs. The latest increase has been fueled by an increase in the number of individuals moving back to the city over the last few months, high mortgage rates, and remote work that justifies the need for certain renters to pay higher rents since they place a greater value on their living spaces.
Concurrently, as a result of the lifting of a moratorium on evictions in the state of New York, the rate of evictions is on the rise, which, when combined with the inability to find cheap housing, may further worsen the problem of displacement. The price barrier that was passed in May provides evidence that rentals will continue to be high, at the very least during the summer, which the majority of real estate brokers regard to be the busiest time of year for the rental market. But brokers predict that over the long run, tenants won’t be able to keep up, and that prices will have to come back down to earth.
People are finding it more appealing to rent flats rather than purchase property right now as a result of rising mortgage rates. According to Jonathan Miller, who works for the appraisal business Miller Samuel, “This throws a part of would-be house purchasers into the rental market, which is already tight.”
Mr. Miller went on to say that individuals have been able to justify paying higher rents because to the advent of remote work settings since they spend more time where they are living. “People are living where they truly want to live, which may also be a motivator for spending more than they are accustomed to paying,” he added. “People are paying more than they are used to paying because of this.”
People who are searching for apartments are having to compromise on important amenities or broaden the scope of their search to include places that were not initially on their wish list. Hal Gavzie, the executive manager of leasing at Douglas Elliman, said that people are looking at alternative regions that are not as desirable. “People are looking at different areas,” They are making a greater number of concessions. If they were seeking for anything in the building that had laundry facilities, they have likely realised that such services are no longer being provided.
Mr. Miller predicted that in the long run, rents would either have to decrease or attain a level of stability. He said that the most effective remedy for high house prices was high housing prices itself. When a customer is unable to pay for a product or service, they will go elsewhere.