Manhattan Apartment Rents Fell in Fourth Quarter in Recession

Manhattan Apartment Rents Fell in Fourth Quarter in Recession 2009-01-14 18:55:23.972 GMT By Peter S. Green Jan. 14 (Bloomberg) -- Manhattan apartment rents fell in the fourth quarter as the recession and Wall Street job cuts deterred tenants from moving. Rents fell 3.9 percent for studios to an average of $1,841, one bedroom apartments dropped 2.5 percent to $2,527 and two- bedroom apartments... [more]

Manhattan Apartment Rents Fell in Fourth Quarter in Recession 2009-01-14 18:55:23.972 GMT By Peter S. Green Jan. 14 (Bloomberg) -- Manhattan apartment rents fell in the fourth quarter as the recession and Wall Street job cuts deterred tenants from moving. Rents fell 3.9 percent for studios to an average of $1,841, one bedroom apartments dropped 2.5 percent to $2,527 and two- bedroom apartments fell 4.2 percent to $3,551 from a year earlier, brokerage Citi-Habitats Inc. said today in a report. Three-bedrooms dropped 0.1 percent to an average of $4,712. Wall Street banks and securities firms are firing workers after recording more than $677 billion mortgage-related losses and write downs. The U.S. economy is moving into the second year of a recession, which is also discouraging prospective renters from moving, Gary Malin, president of Citi Habitats, said in an interview. New York State Comptroller Thomas DiNapoli said last month the city could lose 175,000 jobs in the next two years. “People are saying maybe I’ll stay on Long Island for another year or get a roommate or get a walk-up,” Malin said. “Right now the most important thing for a renter is price. Six or nine months ago, amenities played an equal, if not greater role.” Rents typically fall and vacancies rise in the fourth quarter as fewer people change jobs, Malin said. The reduction in Wall Street’s year-end bonuses has also hurt rents, he said. Neighborhoods In December, the cheapest apartment in Manhattan was a studio in Washington Heights, at $1,065 a month. In the fourth quarter, the priciest studios were in the SoHo/Tribeca area, near both Wall Street and some of the city’s most fashionable shops and restaurants, for an average of $2,398 a month. The most expensive apartments in the survey were in buildings with a doorman that were built in the past five years. Rents in those properties averaged $10,650 for a three-bedroom apartment. Excluding two of the most expensive recent developments, 15 Central Park West and the Time Warner Center at Columbus Circle, rents for three-bedroom units in buildings attended by doormen averaged $8,506 in the quarter, Citi Habitats reported. Vacancies in the fourth quarter averaged 1.96 percent, up from 1.13 percent a year earlier. The lowest vacancy rate was in the East Village, where only 1.73 percent of rental apartments were unoccupied. The highest vacancy rate was in the Battery Park City/Financial District area, where it stood at 2.22 percent. In December, Citi Habitats closed its rental office near Wall Street. “Given the world order, we felt it wasn’t the right time to secure a new location in the financial district,” Malin said in an interview. [less]