Proprietary Data Insights
Top Residential REIT Searches This Month
Already Outrageous New York City Rents Continue To Spin Out of Control
When Miller Samuel and Douglas Elliman released its monthly report on New York City rents for July 2023, the media coverage pretty much began and ended with the headline number: The average Manhattan rent just hit a new record of $5,588 a month.
Impressive headline, no doubt. Makes sense because – present company included – people love to gawk at costs of living on the extreme.
However, one of the benefits of subscribing to The Juice is we take these reports and go beyond the headlines. It’s when you dig deeper that you see just how outrageously expensive it is to rent in Manhattan, but also in other parts of New York City.
We’ll get to that in a second, but first a deeper dive on the Manhattan numbers.
Of course ultra-luxury rentals on the high end amp up the average. However, it’s still interesting to point out that to be able to afford $5,588 in rent and not spend more than 30% of your income, you need to earn a whopping $18,627 a month, or $223,524 a year. For the record, in July 2022, the average rent in Manhattan was $5,113. So we’re talking about a 9.3% increase.
More indicative of conditions on the ground, the median rent in July in Manhattan was $4,400, up 6.1% from $4,150 at this time last year. To comfortably cover that rent, you’ll need to make $14,667 a month, or $176,004 annually.
Breaking it down by unit size in Manhattan (median rent, y-o-y increase):
We wanted some actual examples so we hit up the listings from Equity Residential (EQR), one of the top five most searched residential REITs this month in Trackstar, our proprietary sentiment indicator.
Here are the advertised prices from some of EQR’s buildings across Manhattan. Equity Residential apartments tend to be on the higher end of the market. We sample a few neighborhoods here, followed by the starting price for a studio, one-bedroom and two-bedroom unit:
These numbers jibe with Samuel and Elliman’s data showing $6,225 median rent for new construction, $5,140 for doorman buildings and $8,748 for lofts.
Go without a doorman and your median drops to a less intimidating $3,750.
However, with the median rent nationally for July, 2023, at $2,023, it’s pretty crazy to think just how expensive Manhattan is, even on the “low” end.
Because New York City isn’t just Manhattan, let’s consider Brooklyn.
And it’s not a whole hell of a lot better in Northwest Queens:
The Bottom Line: It used to be that you made the move from Manhattan to Brooklyn in search of more affordable housing. There was a similar dynamic at play on the West Coast between San Francisco and Oakland.
While those moves might be happening for the same reason, we need to redefine the word affordable. And maybe go with slightly less expensive. Because it appears that years’ worth of this urban migration pattern has not only made Brooklyn more costly. The prices are getting out of control in Queens as well.
It’s official – New York City has become a playground for the rich and relatively super well off. How we long for the days of a grimey Times Square and a Hell’s Kitchen you were afraid to walk through.
In Monday’s Juice, we flip the script and look at all the apartment or house you can get in less expensive parts of the country.
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