Manhattan Rents Have Record Jump as Tenants Seek Upgrades

(Bloomberg) -- Manhattan apartment rents surged by the most on record as workers committed to finding nicer digs in the city in anticipation of a return to the office. 

The median rent rose 18% in October from a year earlier to $3,382, appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate said in a report Thursday. It was the biggest annual increase in data going back a decade, though rents are still below the October 2019 median of $3,409. 

Apartment hunters who were shut of the suburban homebuying market are discovering they can upgrade to a better city rental instead, said Jonathan Miller, president of Miller Samuel. Others are securing units close to the office, anticipating they’ll eventually have to go back.  

“There’s more people understanding the relationship of where they want to live and where their employer wants them to work from,” Miller said.

The preference for higher-end apartments drove up rents across all categories last month, even as the number of new leases plummeted.

Rents in buildings with doormen jumped 25% to a median of $4,263. In non-doorman properties, which tend to be cheaper, the increase was just 7.4%.

Studio costs climbed 17%, one-bedrooms jumped 16% and two-bedroom rates were up 26%. Each set a new benchmark for annual growth, Miller said. 

The number of new leases, meanwhile, fell 22% from a year earlier to 4,395 as the market reverted to normal seasonal patterns. 

©2021 Bloomberg L.P.