Thursday, November 13, 2008

Rental Deals, Incentives Increase, Prices Down

A Large 1 Bedroom doorman, $2800. offered with no fee in the East 60's off Third

There seems to be a marked increase in discounting and incentives for rental properties lately. Supply is up and landlords are reaching a point of aggressiveness not seen since the tragic events of 9/11.

The emails keep coming and the number of incentives are piling up. More and more landlords who have never paid the brokerage fee are now doing so, and those who are not are making up for it with aggressive pricing, or both. While the NYC vacancy rate is now estimated by various sources to be anywhere from 2%-5%, this is a far cry from 15 months ago when it was widely accepted that the rate was less than 1%. If I had to throw a number out there, I'd say the vacancy rate is 4%+ and slowly climbing.
As for pricing, while some apartments are keeping the premium, some are at prices I haven't seen in years. What were $2600 and $2800 studios are now going from $2000-$2400. 1 bedrooms that would have fetched $3400, going for $2800. And 2 bedrooms are seeing prices up to $1000 lower than this time last year. It seems like turn back the clock on pricing time. Some are saying rental prices are down 2% or 3%, I'll give it to you straight- they are down 10% and in some instances 20%. One thing is for sure, it's a great time to be a renter (for once).

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