In the highly competitive Manhattan rental market, landlords continue offering renters concessions, such as a period of free rent or price reductions, to offset rising rental prices. And in December, a record number of leases were signed with landlord concessions, says a new market report by New York brokerage Douglas Elliman.
For the third month in a row, the share of leases with landlord concessions set a new record. In December, the number of concessions rose to 26.4 percent — more than double the 13.1 percent recorded in 2015. The length of the free rent concession dropped from the 1.5 months landlords gave last year to 1.3 months last month.
Net effective rent, which includes concessions, dropped for the fifth consecutive month. The median rental price declined slightly year-over-year to $3,291 — down from the $3,294 recorded last year.
Meanwhile, the listing discount from the original asking price to signing price rose to 3.7 percent, up from the 3.3 percent recorded last year. Apartments were on the market for an average of 57 days in December, one day more than last year.
Renters were able to find landlords more open to negotiating as units remained unoccupied longer, according to Elliman. The number of new leases increased nearly 41 percent year-over-year, as Manhattan’s vacancy rate lowered to 2.69 percent from last year.
Manhattan’s listing inventory increased 23.4 in December 2015, while the average price fell 2.5 percent year-over-year to $4,044. However, in the luxury market — or the top ten percent of the most pricy listings — the average price dropped nearly 12 percent from 2015 to $10,015. Although the number of new leases increased 41.1 percent year-over-year for luxury units.
However, the average price on entry level Manhattan apartments rose 2.7 percent from last year to $2,300.
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