The average cost of Manhattan apartment rentals surged to the highest ever for a December, with landlords demanding double-digit rent increases amid sharply dwindling supply.
The median rental price for Manhattan properties, including discounts, hit $3,392 last month — the highest for a December in more than a decade of record keeping and up 21% from the year-earlier December, according to a market report compiled by brokerage firm Douglas Elliman and appraiser Miller Samuel.
Median rents for doorman buildings – a proxy for luxury apartments, was $4,298, an annual increase of nearly 23%. By comparison, non-doorman buildings saw rents increase about 8% to $2,695.
Studio apartment units saw the biggest jump, with the median rental price jumping 22% to $2,550 for December.
Apartments located in downtown Manhattan were most expensive, with a median price that rose 28% to $4,095 for the month.
The numbers marked a stark contrast compared to December 2020, when surging COVID-19 caseloads stoked concern of a mass exodus from New York City. The vacancy rate dropped to just 1.7%, down from nearly 11% one year earlier.
“What started as a trickle earlier last year has become like a geyser of demand,” Douglas Elliman rental broker Janna Raskopf told CNBC. “I’ve been doing this for 14 years and it’s absolutely unprecedented.”
Listing inventory plunged 81% year-over-year in December, with less than 4,800 apartments listed as available for rent.
The lack of available inventory appeared to impact the number of new leases, which fell nearly 40% to just 3,345 for the month. A surge of COVID-19 infections driven by the Omicron variant also likely affected the numbers.
“The market is coming off of unsustainable activity levels and trending toward more sustainable patterns in the coming months,” Jonathan Miller, CEO of Miller Samuel, told Bloomberg. “Omicron is in the mix for sure, just slowing down activity too.”