Once again, the rent is prohibitively expensive.
New record high rents and bidding wars have been the final straw for many city dwellers who have weathered the pandemic in the boroughs. Rather than renewing their leases, they have relocated to more affordable areas.
On a call to discuss first-quarter earnings on Wednesday, Mark Parrell, CEO of real estate investment firm Equity Residential, stated that bargain hunters are “choosing to move out versus paying the higher current price.”
As if renters needed any more proof that the market is currently dominated by landlords, he added that the situation is “not a concern because we are easily able to attract new residents at these higher rates.”
While many New Yorkers are being pushed out of the city by rising prices, Equity Residential is having a blast with the current real estate market. The net-effective rent increase on leases renewed this quarter by the Manhattan, Brooklyn, and New Jersey-based company was 21 percent, far higher than the 14.5 percent increase on leases last quarter.
The rent increases reported by some renters this year are indeed obscene.
“It should be illegal,” New York residential agent Brett Allen said of recent rent increases in the boroughs to The Post in February. “It’s dreadful. I’m seeing a lot of people evicted from their homes, people who paid their rent on time and had perfect credit.”
Anne Kennedy, a three-year West Village resident, had planned to renew her lease on her $2,696-per-month studio until she learned her landlord planned to raise her rent by 46.5 percent to a whopping $3,950.
In NYC, rising rents and inflation have created what is undeniably a landlord’s market.
“It’s actually comical,” she said, adding that it’s also “definitely heartbreaking” because she won’t be able to live in the building with one of her best friends any longer.
It certainly stands in stark contrast to the deals many renters enjoyed during the pandemic. According to a recent report from roommate search platform SpareRoom, the beginning of 2022 saw the “largest rent increase since before the pandemic began.” “Every borough in New York City saw an increase in rents over the last year, with Manhattan leading the way with a 15% increase, followed by Brooklyn at a 13% increase.”
Inflation, of course, hasn’t helped matters.
“Rents in New York were hard hit during the pandemic, but as the city begins to recover, so does the rental market,” SpareRoom director Matt Hutchinson said. “Roommates who welcomed the drop in rents will be disappointed now, as they begin to rise quickly.” With the vast majority already concerned about rising living costs, the prospect of rents reaching new all-time highs, which is certainly a possibility during the summer months, could cause serious problems for an already overburdened generation.”