The citywide median asking rent rose 10.7% year-over-year to $3,700 in May, right after setting a new record in April this year at $3,650. The new record reached in May is the highest among StreetEasy data, stretching back to 2006. Asking rents have been setting new records across the city as competition for limited inventory continues to heat up.
With elevated asking rents encouraging more homeowners to consider renting out their homes rather than selling, rental inventory is growing at a faster pace. In May, there were 34,290 homes for rent in NYC, up 18.5% from May 2022. Rental inventory has seen double-digit growth since January this year, which has the potential to ease competition among renters, although renters’ options are still limited relative to before the pandemic. Compared to May 2019, citywide inventory is down 22.6%. As a result, while it’s unlikely that asking rents will drop compared to last year, year-over-year rent growth will continue to slow this year.
Despite concerns over affordability, the city’s strong labor market is supporting demand for rentals. Competition among renters is fierce, albeit not as tough as during the market’s peak last summer. The average rental listing on StreetEasy received 76% more inquiries this May compared to before the pandemic in May 2019.
Queens Emerged As the Most Competitive Rental Market
Competition in May was toughest in Queens, where an average listing received 133% more inquiries compared to May 2019, more than double the pre-pandemic level. As New Yorkers look for more affordable homes across the city, competition is building in Queens as the more affordable alternative to Manhattan and neighboring Brooklyn. The borough-wide asking rent rose 12% year-over-year to $2,800 in May, setting another record high for the second consecutive month. Rental inventory in the borough rose modestly by 5% year-over-year in May, but there were still just 3,983 homes for rent, a fraction of the inventory available in Manhattan and Brooklyn. In addition to rising demand, limited inventory is behind the fierce competition for rentals, as Queens inventory this May was 28.4% below its May 2019 pre-pandemic level.
Within Queens, hybrid work is also reshaping the borough’s rental market, with neighborhoods closer to Manhattan rising in popularity. The most popular neighborhoods were Astoria, Long Island City, and Sunnyside, all located in Northwest Queens. An average listing in the area received 150% more inquiries than in May 2019. These neighborhoods offer relatively quick commutes to Manhattan, but convenience comes at a cost. Median asking rents in Long Island City set a new record high this May at $4,259, up 3.9% year-over-year. While the neighborhood’s median is higher than the borough median by 52%, renters can enjoy convenient access to Midtown in addition to sought-after amenities in new developments. Of these three neighborhoods, rents are rising the fastest in Astoria, where the median asking rent rose 10% year-over-year to $2,750 in May. Sunnyside also set new record highs this May at $2,455, up 6.7% year-over-year.
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Median Asking Rents in Manhattan Remained at Record Highs
The median asking rent in Manhattan was $4,395 in May, holding steady month-over-month from the record high reached in April, according to StreetEasy data going back to 2006. That’s an increase of 9.9% from May 2022, and 27.2% from May 2019. Although this $4,395 median asking rent is much higher than in the other boroughs, Manhattan rentals remained popular as more workers returned to the office at least part-time.
The most popular area in Manhattan in May was the Upper East Side, where an average listing received more than double (103.5%) the number of inquiries from renters it received in May 2019. The neighborhood’s median asking rent rose 15% year-over-year to $3,910 in May. Upper Manhattan, including Harlem, Morningside Heights, Washington Heights, Inwood, and Marble Hill, also saw fierce competition for limited rentals this May. An average listing in the area received double (99.8%) the inquiries it received in May 2019.
Despite elevated rents, hybrid work is supporting demand for rentals in Downtown and Midtown neighborhoods. Average listings in these areas received 48.5% and 52.2% more renter inquiries, respectively, compared to May 2019. The median asking rent in Midtown rose 2.8% year-over-year to $4,525. Across Downtown neighborhoods, the median asking rent rose 4.1% year-over-year to $4,995. These areas are attracting more New Yorkers who are re-prioritizing an easy commute to the office.
Rental inventory in Manhattan is rising quickly compared to last year, with soaring asking rents encouraging more homeowners to consider renting out their vacant homes rather than selling. There were 18,233 available rentals in Manhattan in May, up 27.5% year-over-year. The inventory of condo rentals grew the fastest in Manhattan, rising 38% year-over-year in May. By comparison, inventory rose 21% year-over-year in rental-only buildings, which make up the majority of rental supply in Manhattan.
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Brooklyn Is the Second Most In-Demand Borough
Brooklyn was the second-hottest borough behind Queens in May, with an average listing receiving 108% more inquiries than in May 2019. Renters have been increasingly looking to Brooklyn to find additional space at a lower cost compared to Manhattan. However, low inventory in the borough led to sharp increases in asking rents this year. The borough-wide median asking rent rose 10.2% year-over-year to $3,400 in May, matching the borough’s record high reached in August 2022. Rental inventory in Brooklyn jumped 12.2% year-over-year, but was still down 28.8% compared to May 2019.
Neighborhoods near Prospect Park, known for its vast green space as well as a zoo, were the most competitive in Brooklyn. Listings in this area, encompassing in-demand neighborhoods such as Park Slope and Prospect Heights, received 154% more inquiries on average than in May 2019 — more than double their pre-pandemic averages. These neighborhoods also offer easy access to public transit.
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Looking Ahead
Affordability remains the most important consideration for renters amid soaring rents, but commute time has become important again as more New Yorkers return to the office at least part-time. Neighborhoods such as Park Slope and Prospect Heights in Brooklyn and Astoria and Sunnyside in Queens, which offer convenient access to public transportation at relatively affordable price points, will likely continue to rise in popularity this year.
Despite double-digit growth in rental inventory since January this year, it’s unlikely for renters to see any meaningful discounts this summer. Summer is typically the busiest season for the NYC rental market with many rental leases expiring. As more renters jump into the market, asking rents will likely remain near record-high levels this summer.
Beyond this summer, as more rentals continue to hit the market, NYC renters will likely enjoy more options. The number of newly listed rentals grew 14.9% year-over-year in May, the fastest pace since May 2021 when many New Yorkers were on the move during the pandemic. As rental inventory continues to rise this year, yearly rent growth will likely cool more materially after this summer.
The normalization of the rental market is still underway, albeit at a gradual pace. Though the citywide median asking rent rose 10.7% year-over-year in May, this pace is less than a third of the annual growth in May 2022 of 33.7%. In addition, 14% of rental listings lowered their asking rent while listed on StreetEasy, matching the share of listings offering discounts in May 2019. This is 3.8 percentage points higher than May 2022, when the market was heating up with soaring renter demand.
All this means renters who have a flexible move-in date will likely see a wider range of options later this year, with less severe competition compared to last year. Renters who are renewing leases may be able to take advantage of a seasonal slowdown in competition after the summer months by negotiating with their landlords on renewal terms. Renters looking to move apartments can narrow down their options across the city with StreetEasy’s NYC-centric search filters, such as nearby transit lines and neighborhood amenities like laundromats and restaurants. Heading into the busy summer season, acting fast will be essential for renters to stand out and score an apartment when they find the right one. For more renting tips, consult our series, Renting in NYC: The Ultimate Guide.
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