Brooklyn, Queens Rents Top Records as Manhattan Sits on Plateau

Apartment rents in Brooklyn and Queens surged above record levels in January, while rents in Manhattan—still flirting with record levels achieved last year—appeared to plateau.

Average monthly apartment rental prices increased in January by about 9% in Brooklyn and Queens over December’s results, rising to new record highs of $4,165 and $3,577, respectively, according to a new Elliman Report.

Average rents in Manhattan were $5,142, a 1.9% decline over December, but still the third-highest average on record. Rental prices per square foot in Manhattan dropped 5.7% to about $77/SF.

“After peaking in July, median rent continued to move sideways [in Manhattan] at a nominally lower level as new leasing levels expanded in the New Year,” Elliman’s report said.

This didn’t stop CNBC from climbing to the top of the Empire State Building (or whichever building has the broadcast antenna these days) and beating its chest about Manhattan rents “hitting an all-time high” and recording a median increase of “15% from the year-earlier month.”

Memo to CNBC: no, it’s not a new record, and “year-earlier month” sounds like a big new trend until you realize it’s a somewhat contortionistic permutation of year-over-year. (We’d call it “sensationalistic,” but that phrase has been trademarked by a high-profile NYC real estate CEO.)

Regarding month-over-month results—a much more reliable metric for tracking market movements amid uncertain economic headwinds—Elliman reported that new leases in Brooklyn rose month-over-month for the first time in four months. Concessions paid by landlords were at their highest level since the fall of 2021, Elliman reported.

The average amount of concessions in Queens (full disclosure: Elliman’s report actually covers Northwest Queens, which is where most of the condos and coops are located), was the equivalent of 1.8 months of rent, the largest total in nearly a year, the report said.

Listing inventory for the Queens rental market was up 40% compared to December and almost double the pre-pandemic level, Elliman said. The Elliman Report is jointly produced by Douglas Elliman Real Estate and Miller Samuel Real Estate.

“We’re not seeing rents fall in any meaningful way. They’re really just moving sideways,” Jonathan Miller, CEO of real estate appraiser and research company Miller Samuel, told CNBC.

We’re not sure if we should characterize this as a “meaningful” drop—it depends on the overall size of your wallet—but monthly rents for the top 10% of luxury rental offerings in Manhattan declined by nearly 7% to $13,665 from December’s level of $14,678.

While new leases for Manhattan apartments increased by 8% over December, Miller noted that the vacancy rate dropped to 2.5% in January, below the 3% rate that he said is more typical for Manhattan.

Josh Young, an executive VP at Brown Harris, called NYC’s rental market “a tale of two cities.”

Young told CNBC there is strong demand for high-quality rentals that are coming on the market in prime locations, creating a limited supply of these prized apartments. However, potential apartment buyers are sitting on the sidelines—in rental units—choosing to rent while they wait for sale prices to fall.

“They’re sitting and waiting in rentals until prices come down,” Young told CNBC. “They don’t want to be the one who buys and overpays for a property that will be worth less in six months.”

According to Elliman’s January condo report, 186 condo contracts were inked in January, a 51% drop from the 381 sold in January 2022.