NYC buyers piled into the rental market in April, fueling a trend toward higher rents

Would-be buyers in New York City had second thoughts in April about entering the sales market and signed new leases instead.

That contributed to a surge in leasing activity in Manhattan, Brooklyn, and Queens last month, according to the latest edition of the Elliman Report for the rental markets in those boroughs.

Many New Yorkers “changed their minds about purchasing,” said Jonathan Miller, president of appraisal firm Miller Samuel and author of the report. It’s a trend that’s been gathering steam in past months because elevated mortgage rates haven’t received an expected reprieve from the Federal Reserve. Instead, interest rate cuts appear to have been pushed to the end of the year or even 2025.

New leases have been elevated since November but jumped significantly in April, Miller said, increasing 41.7 percent year over year in Manhattan, 157.9 percent in Brooklyn, and 147.4 percent in Queens last month, according to the report.

That demand is helping fuel a trend toward higher rents for Manhattan.

“We could be talking about record rents in the summer when they normally tend to peak. A few months ago [when rents dropped] that seemed unthinkable,” he said.

Also unusual is a negative listing discount in Manhattan (-0.1 percent)—meaning the average rent last month was higher than the average price, a result of renters offering to pay more than the landlord was asking to secure the apartment quickly.

“Some renters will pay $300 or $400 above ask because they know there are 20 people vying for the apartment,” Miller said.

Bidding wars were highest for smaller apartments, yet another sign of how competitive the rental market is now, he added.

Manhattan median rent edges higher

Both median rent and net effective median rent (which includes concessions like a month of free rent) in Manhattan rent rose year over year to the highest April on record.

Median rent was $4,250, a 0.2 percent increase over April 2023. Listings were up 22.7 percent over last year and the vacancy rate was 2.49 percent.

Brooklyn rents hit record for April

Median rent and listings in Brooklyn grew year over year for the third time, and both median rent and net effective median rent rose year over year to the highest April on record.

Median rent was $3,599, an increase of 2.8 percent over April 2023. Listings were up 16.2 percent year over year, the second-highest April on record.

The listing discount also went negative in Brooklyn. It was -3.3 percent last month and -3.1 percent in March. In April 2023, it was -0.4 percent.

Queens rents fell again

Rents for the Northwest part of Queens that is covered by the Elliman Report fell annually for the second time. Median rent was $3,244, a drop of 8 percent compared to the prior year.

Listings were up 65.4 percent, and the listing discount was -2.1 percent, similar to the prior month. In April 2023, it was -1.8 percent.

Many renters decided to stay put

The Corcoran Group also released its Manhattan and Brooklyn rental reports for April. 

Gary Malin, chief operating officer at the Corcoran Group, noted that high rents for new leases in Manhattan encouraged many renters to stay put and renew their leases, a factor that is contributing to a very low vacancy rate.

Across the East River, Malin said that Brooklyn had its strongest April in three years thanks to a surge in new leases.

“Most renters remain price-sensitive and for some, Brooklyn offers a chance for more space at a lower rent,” he said.