The second quarter of 2020 saw New York City's real estate market plummeting due to the pandemic as rental prices in Manhattan sank for the first time since the Great Recession, the latest study says.
According to a study by StreetEasy, the Manhattan Rent Index fell year-over-year by 0.9 percent to $3,236. From April to June 2020, around 34.7 percent of all rentals in the borough received a discount suggesting a sharp decline in demand and causing landlords to slash 6.7 percent off the median asking rent or $221 per month.
The most significant drop in rents was recorded in the borough's priciest apartments, with 20 percent of the most expensive units slashed 1.4 percent in rents to $6,325. Meanwhile, sale prices recorded a decline as well as the StreetEasy Manhattan Price Index dropped 4.1 percent from the same period in 2019 to 1,062,276.
Meanwhile, rent prices in Brooklyn are also falling. Twenty-five percent of rental in the borough received discounts in Q2 of 2020 or 8.6 percent more than the same period last year, the report said. The StreetEasy Brooklyn Rent Index saw an increase of 2.6% to $2,728 while the Price Index also dropped 1.6 percent to $687,160 - the largest year-over-over decline in home prices in Brooklyn in seven years.
On the other hand, Queens had 22.5 percent of rental getting discounts or a 4.7 percent rise year-over-year. However, rents climbed, albeit at a slower rate in two years. Rent Index rose 1.2 percent during the second quarter of 2020 to $2,196, while home prices did not move at $507,321.
Despite the decline in demand for new rentals, StreetEasy user search data indicate a rise in searches for rent in all of New York's three boroughs over 2019, as people as forced to stay at home.
Brooklyn registered the most significant rise in user interest or 26 percent more than over a year ago, while searches in Queens rose 24 percent. Manhattan rentals searches also jumped 15 percent from the same period last year.
In response, landlords shifted to virtual tour offerings. Uploads of walkthrough videos on rental listings rose 54 times more in the second quarter of 2020. Landlords also added ten times more floor plans.
About StreetEasy
StreetEasy is owned and operated by Zillow Group. While StreetEasy tracks data for all of New York City's five boroughs, only reports for Manhattan, Brooklyn and Queens are currently being published.
The StreetEasy Market Reports provide a monthly overview of sales and rental markets in Manhattan, Queens, Brooklyn. The report is based on publicly recorded sales and listings data.
The StreetEasyRent Indices track changes in rent for all housing types in Manhattan, Brooklyn, and Queens and are currently available from January 2007 (Manhattan), January 2010 (Brooklyn), and January 2012 (Queens). Each monthly index uses a repeat-sales method that evaluates the rental price growth according to homes in a particular geography that has been listed for rent more than once.
The StreetEasy Price Indices track resale price changes of townhouse units, condo, and co-op. Each monthly report uses a repeat-sale method to compare sales prices of the same property from January 1995 (Manhattan) and January 2007 (Queens and Brooklyn).
