It all seems like a dream, now, the boom market in Manhattan real estate. But while it was unsustainable and way overhyped, and is faintly ridiculous in retrospect, there was a period when Manhattan rental apartments enjoyed an almost instant absorption rate and rental activity was almost terrifyingly constant. That was the middle of 2007, and it seems a long time ago now. But while many of the things that seemed cool in 2007 seem less so, now -- remember how much scarier the world was when Lindsay Lohan wasn't in jail? -- NYC real estate watchers have never quite given up hope that those days might return to the Manhattan rental market. The just-released quarter two Manhattan apartment rental stats suggest, though, that the pre-Lehman glory days of Manhattan real estate aren't coming back. No, the new stats suggest -- astonishingly -- activity in the Manhattan rental apartment market was well beyond those mid-2007 levels. In other words, the Manhattan rental market is not only back, it's apparently stronger than it was during its historic highs. Even more surprisingly, while rental activity soared, rents stayed mostly flat. Maybe that (prematurely lamented) renter's market will survive the turnaround in Manhattan real estate after all.
So, how have prices stayed flat -- actually, they've declined 3.3 percent from last year, the report reveals -- while rental activity has taken off? In The Real Deal, Candace Taylor explains this seemingly disjunctive -- if notably renter-friendly -- development. "While rents are similar to where they were a year ago, shrinking inventory and more rental transactions mean landlords are not giving as many concessions to tenants," Taylor reports. "'Now it's more typical to see one-month free rent, [as opposed to] six months ago when it was two to three months,' Miller said. 'We're still seeing some concessions, but not the level that we were.' So while landlords are not charging significantly higher rents than last year, they are likely to be making more money."
The decline in concessions, while not a new development, is not nearly as renter friendly as those stalled out rents. But at the same time, a month's free rent is nothing to sneeze at, especially when the news of declines in renter concessions arrives wrapped in the good news that the increased demand for Manhattan apartment listings has not caused rents to spike. The second quarter is traditionally the strongest for rental apartment stats, and one good quarter does not, obviously, a turnaround make. But it does make NYC real estate watchers optimistic, and it should -- the last time Luxury Rentals Manhattan's apartment rental listings were this appealing, Lehman Brothers still existed, Glenn Beck was still blessedly obscure, and La Lohan was free to break stuff and harass the staff at Marquee. It's okay to celebrate, and it's definitely okay to check out those Manhattan rental listings.
