Looking for silver lining - will crisis lower rents?

[Hawkins]

my point was more New York will always be more a "renter's" market and will always have high demand, one way or another. While there may be a few more properties for sale, most of these would be properties that would not be in the supply of rental units, therefore, rents won't go down.

 

[qnarf]

my point was more New York will always be more a "renter's" market and will always have high demand, one way or another. While there may be a few more properties for sale, most of these would be properties that would not be in the supply of rental units, therefore, rents won't go down.

this has not always been the case and there's no reason to believe that it will always be the case. through large swaths of the 70s and 80s it was not the case. directly after 9/11 it was not the case. should the economy continue to go south, should the city in some sense become undesirable to the wealthy [if crime rates spiked, for example, or if municipal services shut down due to city insolvency] i'd imagine rents would sharply go down.

 

[icouldbewrong]

EthanK:

PS. Apologies if I'm being unnecessarily alarmist. I'm not a real estate expert; I've just played one in improv.

 

[Dunford]

I agree that the current economy will cause rents to fall with the following glaring exceptions:

New York City
San Francisco

New York City isn't "poor and dangerous" anymore. It's "Arabic and Asian."

By New York City, I think Jed means all of Manhattan, most of Brooklyn, and some of Queens. The Bronx is still very much poor and dangerous, and will probably see rents drop still.

 

[Resnik]

By New York City, I think Jed means all of Manhattan, most of Brooklyn, and some of Queens. The Bronx is still very much poor and dangerous, and will probably see rents drop still.

I honestly don't see rents dropping; the bad areas of the Bronx are still relatively cheap (comparatively), no? And besides, gentrification will hit EVERY neighborhood by the year 3030 (just ask Deltron).

 

[benzado]

I just found this: The Real Estate Group New York publishes a report of Manhattan rental market data once a month since January 2007.

http://www.tregny.com/manhattan-apt-rental-report.jsp

Citywide, rents are down on average this year compared to last. Depending on neighborhood, it varies. Anyway, this is actual data and therefore might be useful to people looking for actual answers.

 

[Dave Serchuk]

Initially rents will rise as there will be more demand on rentals as fewer people buy.

 

[Fred Garvin]

I just found this: The Real Estate Group New York publishes a report of Manhattan rental market data once a month since January 2007.

http://www.tregny.com/manhattan-apt-rental-report.jsp

Citywide, rents are down on average this year compared to last. Depending on neighborhood, it varies. Anyway, this is actual data and therefore might be useful to people looking for actual answers.

how dare you answer a question with specific and current data - it gets in the way of the amateur guesses

 

[8cott]

If you are talking about Manhattan, they won't really go down as a whole. The vacancy rate here is way too low. Rents won't increase as much, but they don't typically go down significantly. It is a bit slower right now so some landlords will do the following:
Offer one month free rent, Offer to pay the broker fee (or part of it), be more lenient on rules (such as pets), negotiate a little on the rent.
They are more about incentives, so they aren't lowering the actual rent, thus de-valuing their product.
Brooklyn & Queens may be different though. I only focus on Manhattan.
Let me know if you need assistance.

Scott
646 637 6377

 

[Shmandy Shmarhol]

rent control hasn't existed for years.

Rent control does exist, and more importantly so does rent stabilization and regulation. Only 33.3% of the NYC rental market is truly free market as this report indicates.
http://www.housingnyc.com/downloads/research/pdf_reports/08HSR.pdf

And here's an interesting piece on the subject of rent control from Henry Hazlitt's Economics In One Lesson:What Rent Control Does

 

[qnarf]

rents are down.
http://www.nytimes.com/2009/02/01/realestate/01cov.html?_r=1

 

[saintlennybruce]

I agree that the current economy will cause rents to fall with the following glaring exceptions:

New York City
San Francisco

Then it's really true, "You can never go home."

"You" being me, of course.

 

[Resnik]

rents are down.
http://www.nytimes.com/2009/02/01/realestate/01cov.html?_r=1

I slouch corrected.

 

[Sblake]

rents are down.
http://www.nytimes.com/2009/02/01/realestate/01cov.html?_r=1

I now have an overwhelming urge to move back to Manhattan.

 

[Hawkins]

rents are down.
http://www.nytimes.com/2009/02/01/realestate/01cov.html?_r=1

well, yes and no.

they're saying rent is easier to negotiate, which you should do regardless, and incentives.

"effective rents" meaning what landlords can ask for in an already jacked market.

Sort of like car prices, just because you find it easier to negotiate it down doesn't mean actual prices and costs are falling, just that the market is a little more pliable.

 

[qnarf]

well, yes and no.

they're saying rent is easier to negotiate, which you should do regardless, and incentives.

Although it is notoriously difficult to quantify the state of the rental market, rents fell in almost every sector of the Manhattan market last year, according to the Real Estate Group, a New York brokerage. The steepest drop was in one-bedrooms, down 5.7 percent in buildings with doormen and 6.53 percent in buildings without. The only category that rose: rents for two-bedroom apartments in doorman buildings, up just a bit, by 0.61 percent. But these numbers, like most available data, represent asking rents rather than the final price.

you are incorrect. asking rents are down before negotiations begin.