State of Manhattan Luxury Rentals: Favorable Conditions for Renters in the Future

Written By David Dam | September 12, 2016 | Published in Real Estate Market Trends
2016%2f09%2f12%2f16%2f34%2f44%2fe085e438 e878 4519 a23c 0300a5c9646c%2f3232768913 eaa677a968 b

August marked the unofficial end of the peak of renting season in Manhattan, and in one of the busiest real estate markets in the world, but there’s great news: no rent growth despite increased demand. This is no surprise, however. Over the past few months, the growth of rental apartment prices have slowed or even reversed in Manhattan, Brooklyn, and Queens, with the average rental price at $4,033 — around one percent cheaper compared to last year.

The relative stability of apartment rental prices in Manhattan is largely attributed to new, ongoing development that has constantly added more available rental units to the market. In August, there was a 39.6% increase in listing inventory compared to the same time last year. However, looking at the supply of rental units alone may be insufficient to explain the relative stability of rental prices.

Another factor that may prevent prices from rising in the rental market is a decline in the demand for rentals, which may signal weakness in the economy or other underlying problems. However, this is not true. The number of new leases in Manhattan jumped two percent compared to the same time last year, and almost six percent compared to July 2016. Demand for rental apartments is higher than ever, and the reason why rental prices have not risen is because supply seems to be impressively outpacing that demand.

The same patterns hold true for Manhattan’s luxury real estate industry. The average luxury rental price in August 2016 was $9,843, down around two percent compared to the same time last year. Meanwhile, the number of new leases increased by 1.5 percent compared to last year, and almost five percent compared to just two months ago.

For those thinking about renting an apartment, especially a high-end one in Manhattan, current market conditions favor renters. Stabilizing prices and listings on the market for an extended period of time may allow renters to explore a wide variety of living options. Renters also have more negotiating power, with the listing discount rising 0.6 percent compared to last year — now at 2.2 percent.

While demand for apartment rentals has always been consistently high in Manhattan, supply often fluctuates. However, the real estate market, especially luxury real estate, won’t be facing shortages in rentals any time soon. 5,675 newly constructed units, most of which are high-end, will be added to Manhattan’s rental inventory this year, and there are a slate of projects in Midtown Manhattan on Billionaire’s Row. Other much-anticipated projects currently under construction include Hudson Yards and One Vanderbilt. Once completed, these high-rises are expected to add thousands of additional units to the rental market.

Manhattan’s real estate industry usually sees supply shortages driving prices up. However, the market is now at a point where the supply of apartment rentals has accelerated beyond the consistently high demand for them, creating favorable conditions for renters. Barring any major unforeseen changes, such as a sudden downturn in the economy, we may see a similar rental climate in the next few months or so.

Blog Archive


This information is not verified for authenticity or accuracy and is not guaranteed and may not reflect all real estate activity in the market. © 2021 REBNY Listing Service, Inc. All rights reserved. RLS IDX Data display by Elegran LLC. IDX information is provided exclusively for consumers’ personal, non- commercial use and that it may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing.

Elegran LLC may or may not be the exclusive listing agent of the properties being displayed on All data displayed on is presented for informational purposes only and should be independently confirmed by all customers. All Information is compiled from both public and private sources including, but not limited to the RLS, MLS and ACRIS; each of which is assumed to be reliable. All information displayed is subject to errors and omissions regarding apartment specifications and final sale prices, and further, any unit listed may have had its listing withdrawn without notice subsequent to such information being compiled. No representation is made as to the accuracy of any description (ie: listing, close sale data, and/or building description) of any building or individual unit. All measurements and square footage are approximate and all information herein should be confirmed by customer and/or their attorney. Elegran LLC, its members, affiliates, and contributors adhere to New Your City, New York State, and United States Fair Housing Laws.