The Manhattan real estate market is a complicated thing, as any regular Luxury Rentals Manhattan visitor -- and anyone who has ever tried to find a rental apartment in Manhattan -- could tell you. But one of the most peculiar features of the ongoing turnaround in the Manhattan rental marketplace is just how much more quickly the market for high-end Manhattan luxury rentals has turned around than has, say, the market for $2500-per-month Manhattan rental apartments. Given that there are more people in New York capable of paying more modest monthly rents than there are those willing or able to cut five-figure checks on the first of each month, the turnaround would seem to be somewhat backwards. But this is Manhattan real estate, and the top-down turnaround has become both harder and harder to ignore and -- per a recent New York Times report -- even more pronounced in the early months of summer. The demand for five-figure NYC rental apartments has been higher than that for smaller, less expensive Manhattan apartments. So, what exactly does this mean for Manhattan real estate?
For one thing, it continues a trend that we've noted previously on the LRM blog -- namely that high-end Manhattan rentals seem to have supplanted high-priced Manhattan condominiums as the real estate choice du jour among those shopping for blue-chip Manhattan real estate. It helps, of course, that top-tier Manhattan luxury rentals such as 8 Spruce Street, The Ashley and The Sessanta have effectively closed the gap between Manhattan condominiums and high-end Manhattan rental listings when it comes to the quality of finishes, fixtures and amenities; condominiums-turned-luxury-rentals such as William Beaver House have helped level the playing field, as well. The result: instead of navigating the financial and psychological challenges of buying a luxe condominium on the Upper East Side, in Greenwich Village, or in Tribeca, NYC dwellers are opting to go for luxury rentals on the Upper East Side or Greenwich Village or Tribeca -- and winding up with living spaces of comparable quality, while retaining a flexibility and peace of mind no NYC condo owner can claim. And it makes sense: the opportunity to live a luxurious lifestyle in Manhattan without having to plop down a six-figure downpayment on a million-dollar condo is no less appealing to those who could, with relative ease, cut that six-figure check than it is for those hunting through Manhattan rental listings for deals.
This boom in luxury Manhattan rentals with five-figurem monthly rents hints at a possible rebirth in the Manhattan real estate world, and certainly suggests that Manhattan's high-end real estate types are feeling a bit more comfortable. But what it means for the rest of the Manhattan real estate market remains to be seen, and is something we'll be watching closely. It's safe to say that Manhattan condominiums are in no danger of going out of style, now or ever. But with Manhattan’s elite opting to rent luxury apartments instead of buying condominiums, the old rent vs. buy debate has inarguably gotten a new twist.
