As of March 2022, New York City’s housing market is on a post-pandemic rebound. Rental prices and home prices are both up 12% year-over-year, with the median Manhattan rent approaching its pre-pandemic high of $3,540. In some cases, prospective tenants are even getting into bidding wars, with in-demand units going for above their initial asking price.
Read on for some key figures concerning New York City’s rental market, home prices, and commercial real estate trends going into 2022.
Rental Market Trends and Statistics
1. Median Rental Prices Up 12% Going into 2022, Following Pandemic Slump
New York City saw median rental prices fall dramatically during the early days of the pandemic as people left the high-cost, high-density city for less expensive suburbs that offered more room.
While the median asking rent was $2,895 in November 2019, it had tumbled to $2,500 by November 2020. As vacancy rates soared – moving from 2.4% April 2020 to 11.6% by April 2021 – landlords offered incentives to attract renters, such as rent-free months and waived fees.
However the situation steadily shifted over the course of 2021. Demand began outweighing supply once vaccine levels rose, prompting an end to the incentives many landlords offered in the early months of the pandemic. Year-over-year, prices rose by 12%, from $2,500 in December 2020 to $2,800 in December 2021. That marked the highest annual gain since the start of the pandemic.
[Source: The Guardian]
2. Median Manhattan Rent Prices Up 21%, But Still Below Pre-Pandemic Peak
Generally speaking, December is a slower month when it comes to new leases. However, in 2021, Manhattan bucked the trend, ultimately setting a new record. The median net-effective rent reached $3,392, a 21% increase over the previous year.
Still, that number is just shy of the pre-pandemic record: the median Manhattan rent was $3,540 in April 2020, before the effects of the pandemic and ensuing lockdowns brought that number low.
[Source: The New York Times]
3. Low Supply Prompts Bidding Wars in Early 2022
The New York City rental market has hit a remarkable pace in the early months of 2022. As more people have returned to the city, available housing stock has dropped considerably. Prices have risen to match, and many prospective tenants have even gotten into bidding wars to secure apartments: a one-bedroom apartment on the Upper West Side recently went for $3,625, 17% above the initial asking price.
4. Inventory Numbers Tumble Dramatically, With New Listings Down 86% in Brooklyn
The number of available residential rentals – such as apartments, townhomes, and houses – is tumbling across much of New York City. In January 2022, the number of residential rental listings in Brooklyn – an area that’s long been popular among renters looking for more space – has declined by 86.4 % YOY. In Northwest Queens, inventory dropped by 90.6 % YOY.
Home Sales Trends & Statistics
5. New York Home Prices Rose 12.2% in the Past Year
New York City prices are trending upward: as of February 2022, the median sale price across all types of homes in the city was $802,000, up 12.2% over the previous year. That figure is more than double the national average home price of $412,480.
But the New York real estate market is not uniform across the board. Some boroughs are up more than others, and Brooklyn sale prices are even down relative to 2021:
|Borough||Median Sale Price||Trending|
6. Manhattan Apartment Sales Reach 32-Year High
During the early days of the pandemic, the New York City real estate market was hit hard. Prices dropped, and sales numbers fell. In July 2020, the number of condo sales in Manhattan was down 56% from the year prior, while co-ops were down 57%.
By 2021, the landscape had shifted dramatically. Overall, sales activity came back quickly, with condo and co-op sales reaching a 32-year high, effectively doubling the number seen in 2020.
7. Median Prices Up 17% Over Pre-Pandemic Levels
While the pandemic had a significant impact on the New York City housing market, it only stymied price growth temporarily. Overall, all five New York City boroughs say substantial growth between Q4 2019 and Q4 2021.
Queens say the largest overall change, coming in at 17.7%. The median sales price shifted from $610,000 in late 2019 to $668,000 in late 2021.
[Source: The New York Times]
8. Inventory Shortages Driving Prices Upward, With Available Inventory Down 30.4% Since 2020
Inventory in New York City has long been challenging, playing a significant role in price increases over time. In December 2021, inventory levels fell to 2.3 months, a 30.4% decline from the 3.4-month supply in December 2020.
As inventory levels dropped, prices have risen to match. This comes down to simple supply and demand, as low inventory means buyers may need to have stronger offers to land a home.
[Source: Norada Real Estate Investments]
Commercial Real Estate Trends & Statistics
9. 16.3% of Manhattan Offices Remain Vacant
With many companies still uncertain about the future of working in-office, 16.3% of Manhattan offices remain vacant – the highest vacancy rate on record. However, there are signs of a rebound. New leases in Q4 2021 amounted to 20.4 million square feet of office space. That’s up 63% over 2020, but still 19% below the five-year average.
10. Despite the Pandemic, New York City Commercial Real Estate Maintains More Than 92% of Its Value
While the pandemic impacted various businesses in a variety of ways, commercial real estate in New York City has largely weathered the storm. Overall, commercial properties retained 92.3% of their value compared to January 2020 figures. As recovery efforts continue forward, more progress is undoubtedly possible, potentially leading to a full recovery and then some.
[Source: New York Post]
Ultimately, the housing market in New York City was hit hard by the pandemic, leading to dramatic price declines and rising inventory. For renters, there were even landlord incentives to make signing a lease more attractive.
However, when vaccine rates began rising, people returned to the area in force. Additionally, they began seeking larger homes and rentals, ensuring there was enough space to work from home. While the New York City housing market hasn’t returned to past highs, it may be well on its way. Ultimately, only time will tell.