Free housing in Manhattan: how landlords lure clients

Rental prices in Manhattan continue to fall, and vacancies continue to rise. To get out of the situation, some landlords offer customers free rent for several months. The edition writes about it CNN.

Manhattan's vacancy rate continues to rise after rising to 5,75% in September. This is stated in the report by Douglas Elliman and Miller Samue (Douglas Elliman and Miller Samue).

It was the highest in the report's 14-year history, during which the vacancy rate in Manhattan typically ranged from 1,5% to 2,5%.

While many landlords offered two months of free rent as an incentive in September, some made big concessions - they offered free rent until 2021.

Within a month, more than half of all Manhattan apartments were rented out, and the average rent was $ 3250, down 7% from a year ago. “Rentals are falling and vacancies continue to rise,” said Jonathan Miller, president of Miller Samuel.

However, he sees signs that the city's rental market may be moving into a new phase.

Currently, there is a huge number of apartments on the market that are offered for rent. According to the report, their number has more than tripled compared to last year. In September 15 apartments were rented out.

On the subject: The biggest drop in 30 years: what happens to the New York real estate market

Although, according to Miller, the monthly growth rate in the number of available offers has slowed down. From April to May, the number of such offers increased by 57%. But this growth slowed down over the summer: from August to September, the number of proposals increased by 6%. “This suggests that we are moving into another phase,” said Miller.

But that won't change until more people return to the city and rental prices continue to decline, said Nancy Wu, an economist at StreetEasy, a real estate ad service. “Tenants can count on the concessions (which landlords will make. - Ed.) will continue to grow and they must negotiate deals at least until the pandemic is over and employment, population and economy are restored. "

Landlords are constantly revising their prices, says Eugene Litvak, a real estate agent at Compass, whose team leases 3000 housing units in Manhattan and Brooklyn. “Some months were good when people didn't leave,” he said. "Some months were bad, with 20 out of 18 landlords canceling their lease renewals."

How tenants take advantage of the market situation

Potential tenants can benefit from the current situation in the New York real estate market, Litvak said. “Contact your ad placement agent directly,” he suggested. "What you see on the Internet is not always the only option available, and the price may not be final and you may be offered one or two months of free rental."

Brokers offering many affordable housing units do not always list them on their website. If you are interested in a building, but the proposed apartment is not suitable, talk to the agent - most likely he has other suggestions.

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The timing of the move does matter, Litvak said, and potential tenants can use this to their advantage. Rentals usually start at the beginning of the month, but an earlier move-in date can be tempting for the landlord. “Some people find a compromise by offering to rent a property in three days for an additional 10 days of free stay,” he said.

The spike in vacant apartments in the country's largest rental market is likely to have economic repercussions. Housing experts estimate that roughly half of the apartments rented in Manhattan are owned by small business owners, not large public companies or large, well-funded real estate families. As small landlords lose income, they may lose the ability to pay property taxes, which is New York's largest source of income. Reducing property taxes will entail a reduction in services, making New York less attractive to new residents.

Formerly Miller predictedthat landlords are likely to have some difficult years ahead.