Rents Are Dropping. Tenants Should Enjoy It While They Can
What You Need To Know
As Yung Joc once said, it’s going down.
I’m referring to interest rates and rents of course.?
The median rent in Manhattan fell to $4,200 in September — the fourth drop in the past five months — according to Douglas Elliman’s monthly rental report compiled by Miller Samuel.
Don’t get me wrong, rents in New York City are still astronomical. Rent stood at $3,500 in 2019 — not far off from 2006’s $3,265 peak, when Yung Joc beckoned listeners to meet him at the mall — before surging to an all-time high of $4,400 in the summer of 2023.?
Today, the market remains competitive, with bidding wars causing nearly one out of every five rentals to go for more than asking price. That’s even with inventory expanding 10% year-over-year.
Slightly less rent-burdened New Yorkers have their fellow financially secure neighbors to thank. Last month’s interest rate cut, along with newfound faith that more are on the horizon, is loosening the golden handcuffs that have prevented homeowners and buyers from moving.?
When handed record low mortgage rates during the pandemic, renters flooded the housing market. However, over time, demand caused housing costs to skyrocket and inventory to evaporate. At the same time, mortgage rates rose, and owners clung to their low rates, refusing to let renters-turned-homebuyers in.
Soon after the Federal Reserve’s move last month, the average rate on a 30-year fixed mortgage fell to 6.08%, the lowest since September 2022, according to Freddie Mac data.
However, last week it hit 6.32%, the largest one-week surge since April and the second consecutive weekly jump. It doesn’t help that September’s job report has caused some uneasiness about what the Fed’s future decision-making may be.?
Meanwhile, the pipeline for residential construction continues to be weak as developers eye not just the Fed but also the city council as City of Yes’ housing portion nears final approval. In the second quarter, developers filed permits for just over 3,100 proposed multiple dwelling units across 67 buildings, a 16% decrease in units from the previous quarter and 28% lower than the overall average since 2008, according to the Real Estate Board of New York.
Developers at Bisnow's Multifamily event last week said there are projects being contemplated today that won't go forward without City of Yes passing — and they expressed concerns that the mayor's legal troubles could derail it.
“City of Yes looked really promising, but I feel like we can’t overestimate the surprises that we hear and see in the political arena,” Rockefeller Group's Meg Brod said from the stage on Wednesday. “Without it, I think it would be a real big problem for us.”
— Sasha Jones
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What I Want To Know
Dell has reportedly called employees back to the office full-time with just a few days notice, sending employees scrambling.?
One employee speculated to the New York Post that the new requirement may be “because that’s what Amazon is doing.” The e-commerce behemoth issued a full-time return to work policy a week before Dell, though that kicks in in January.?
But I heard from a broker last week that some workers have found ways to cheat the system, like having coworkers swipe in their key cards for them. If true, that could be inaccurately impacting executive policymaking, as well as bump report numbers. Kastle Systems’ Back to Work barometer, which relies on key card swipe data, currently places the average office attendance in the New York metro area at 66%.
领英推荐
Have you heard of other ways that employees are dodging office mandates? Are employers getting creative to enforce their policies??
Personally, I won't be swiping into Bisnow’s office this week, but not because I’m avoiding it! I’m participating in a business journalism program at the Wharton School. Send me any and all Philly cheesesteak recommendations!
First Look
Dynamic Star has brought in some help to build its Bronx megaproject.?
Through a joint venture with Schoolhouse Project, 160K SF of the 350K SF One Fordham Landing — part of the greater Fordham Landing South development — will be developed into educational use, Dynamic Star told me.?
They are already in talks with two charter schools seeking to relocate or expand to the project under a 35-year condominium leasehold, the developer said. Groundbreaking on the project is expected to take place in the first quarter of 2025, and delivery is planned for Q1 2027.
Can I Give You My Number?
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The number of industrial projects currently under construction in the five boroughs, according to JLL. Of the approximately 2M SF in the pipeline, 18% is preleased. Though concessions are on the rise, a supply shortage may be on the horizon as residents creep into industrial zones and restrictions on last-mile delivery centers are being added.?
They Said What??
“It's just that she may have evidence regarding other crimes,” Arthur Aidala, an attorney for? Ingrid Lewis-Martin, who is chief advisor to Mayor Eric Adams, told my colleague, Ciara Long, after her phone was seized as part of its investigation in the Adams administration. A Cushman & Wakefield broker who is friends with Lewis-Martin also had her phone taken by investigators.
Hang Out With Me
Drop The Hot Goss
The Slice is produced by Bisnow Senior New York City Reporter Sasha Jones and is edited by Deputy Managing Editor Ethan Rothstein. Got an answer to my questions or info that you think I’d be interested in? I’m always happy to chat, on or off the record. Reach me at [email protected] or @SashaJones.06 on Signal, an encrypted messaging app.