Even in a weak market, Manhattan landlords are still raising rent prices, causing vacancy rates to move higher than expected at this time of year.
New York, NY. (PRWEB) July 23, 2008 -- The Real Estate Group's July Manhattan Rental Market Report, released today, suggests that landlords with large building portfolios can't resist raising rents, even in a weak market. Doorman unit inventory continues to increase, and prices have followed. Defying traditional laws of supply and demand, the Manhattan rental market has sparked much confusion this month.
"The logical explanation is that owners of doorman buildings are either: a) unaware that the market is weak or b) doing all they can to resist lowering rents," says Daniel Baum, COO of The Real Estate Group. "Instead, they're offering incentives and then raising prices to try to offset those concessions." Unfortunately, this strategy appears to be working against landlords, resulting in an increasing number of unrented apartments on the market.
In the Financial District alone, all doorman prices went up, by 3.3% for studios, 4.2% for one-bedrooms and 2.6% for two-bedrooms, even though vacancies in this neighborhood are typically on the high side. Meanwhile, non-doorman rents in popular areas like the East Village and SoHo saw prices decrease along with inventory. This may be the key to getting vacancies rented and keeping inventories low for the remainder of the busy season.
A comprehensive update on price changes in individual Manhattan neighborhoods can be found in the Quick Look section on pages 4-7 of the Manhattan Rental Market Report: http://www.tregny.com/manhattan-apt-rental-report.jsp.
The Real Estate Group is a residential sales and rentals brokerage firm. The company's Manhattan Rental Market Report, the only research on Manhattan rental data released on a monthly basis, is frequently cited by the media as a guide to the current state of the city's rental market. More about the firm can be found on its Web site: http://www.tregny.com.
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