New York City apartment rents fell below $ 3,000 for the first time since 2011. A new report from StreetEasy shows the median asking rent for apartments in the third quarter was $ 2,990. Record rent cuts during the pandemic have led to this decline. StreetEasy discounted 44.7% of housing listings, a record for the site.
Manhattan wasn't the only segment of the market where rents were falling. During the third quarter, the Manhattan Rent Index fell 7.8% year-over-year, bringing the median asking rent to $ 2,990 for the third quarter. The Brooklyn Rent Index fell 2.5% year-over-year, bringing the median asking rent to $ 2,599 in the third quarter. and the Queens Rent Index fell 2.2% year-over-year, bringing the median asking rent to $ 2,200 in the third quarter.
As rents for existing properties fell, so did the supply of apartments in New York City, which put rents under greater pressure. The rental inventory in Manhattan grew nearly 70%, or 72,267 units. That is 30,000 more units than in the previous year. Renters are no longer willing to pay a premium to live in the city because they don't have to travel to the office and landlords have had to face the new reality and lower rents to fill units.
In Manhattan, this trend has not only resulted in more discounted units, but also a more substantial discount. The median rental discount in Manhattan rose to 9.1% of the asking rent, or $ 272 of the median rent. This is a 5.2% increase over the average rental discount last year of $ 139 more. The midtown market led the rise in discounts. In the neighborhood, 48% of rents were discounted in the third quarter, an increase of 25.9% over discounted rents in the same period last year. This trend resulted in an overall 5.7% decrease in rents in Midtown, bringing the median rents to $ 3,000.
Housing rental discounts in Manhattan drove rents down in adjacent NYC markets. Rents in Brooklyn and Queens fell less than in Manhattan. However, rents in Brooklyn fell for the first time since 2010, particularly in northwest Brooklyn. Other areas in Brooklyn, such as North and East Brooklyn, remained flat. In Queens, inventories increased more than 41% over the same period last year. This is an all time high for the market.
The decline in housing rents has also blocked the investment selling market. A recent report by the New York Real Estate Board found that multi-family elevator sales were down 17% in the first six months of the year, while non-elevator sales were down 44%.
