Manhattan apartment rents fell as much as 18 percent in the second quarter from a year earlier as rising unemployment curbed demand.
The median price dropped 3.1 percent to $3,100 a month, appraiser Miller Samuel Inc. and broker Prudential Douglas Elliman Real Estate said today. Studio prices fell 18 percent to $2,000; one-bedrooms declined 13 percent to $2,795; two-bedrooms were down 5.1 percent to $4,550 and three-bedrooms dropped 4 percent to $7,673. A separate report from broker Citi-Habitats Inc. showed average rents fell 8 percent for studio and one- bedrooms and 11 percent for two- and three-bedrooms.
“People were kind of in a preservation mode, saying ‘I’m not sure of the future so I’m not going to make any leaps,’” said Prudential Douglas Elliman President Dottie Herman. “Most consumers, when they did not have to make a decision, didn’t.”
The number of new leases signed plummeted 58 percent, according to Miller Samuel. Private-sector employment in the city dropped by 91,200 jobs, or 2.8 percent, in the 12 months through May as Wall Street losses and asset write downs topped $1.4 trillion. National unemployment climbed to 9.5 percent in June, according to the Labor Department.
Across the U.S., apartment vacancies rose to their highest in 22 years in the second quarter, New York-based real estate research firm Reis Inc. said yesterday. The last time landlords had so much empty space was in 1987, when the Standard & Poor’s 500 Index lost almost a quarter of its value in three months.
“Unemployment has had a much more immediate impact on the rental market than the purchase market,” said Miller Samuel President Jonathan Miller.
Landlords agreed to average reductions of 9.5 percent off their original asking rents, compared with a typical discount of 2.6 percent a year ago, Miller Samuel reported.
“Appropriately priced properties are renting at a far greater pace than those properties that are not,” Citi-Habitats President Gary Malin said in a statement. “It is very clear that prices and incentives have played a larger role in the rental marketplace during the first half of 2009.”