- NYC Rentals Are Setting New Price Records As Mortgage Rates Remain Stuck
- Manhattan Is Not A Leading Indicator For The US Housing Market
- Multi-family Sales Are Expected To Go Big In 2025
Back in college, I remember reading a story about the first lead singer for Van Halen getting into a bar fight, saying his adversary’s problem was “more dental than mental.” I applied the literary flex to today’s Manhattan rental trend that counters the US trend. While US rental price growth is easing, NYC is setting new records, particularly Manhattan, which saw the highest median rental price in history. Brooklyn saw one out of three rentals pay above what the landlord was asking. Consumers continue to face tough choices if they want to live in a city where they can buy strawberries at three in the morning (something my dad always said). On the other hand, excessive overbuilding of multi-family homes nationwide has been moderating US rent growth. As a result, lower prices for multi-families are expected to fuel a buying frenzy in 2025.
Manhattan Rent Sets A Record
Here’s a “moving” link to the chart below being drawn, ha. And here’s a link to our NYC rental report released yesterday.
More coverage with some interesting insights:
- Brick Undergound – Manhattan and Brooklyn rents hit ‘unusual’ all-time highs in February
- Crains New York Business – Manhattan rents set a new record during normally quiet February
- Mansion Global – Affluent Renters Paid Record Prices for Manhattan Apartments in February
- Spectrum News – Manhattan’s median rent hit record high in February, report finds
- Zero Hedge – Manhattan Apartment Rents Hit Record High Amid “Irrational” Bidding Wars
National Rental Market Conditions
During my 40 years working in the NYC metro, I’ve occasionally heard the comment that NYC real estate leads the US in trends. To save you time researching this, the answer is “No it doesn’t” or at least I can’t make that case with empirical evidence.
But what I can tell you is that rent growth is slowing across the US, with apartment supplies at 50-year highs:
Final Thoughts
Would-be home buyers have been camping out in the rental market until rates fall. Rates have been down only nominally for the past few months, and because rents began rising again last fall, I suspect that many would-be buyers are staying put for a while. Nationally, the market is different, with oversupply restraining rent growth.
The Actual Final Thought – Here’s some great commentary by Josh Brown, who is a partner in Ritholtz Wealth Management.
ASIDE – Consolidation Chronicles Contains Confusion
I just wrote about the consolidation in the real estate industry with the Rocket Company’s purchase of Redfin. Now we’re reading about Compass acquiring Berkshire Hathaway, and it’s a little shocking. Compass would probably end up having close to 90,000 agents when the deal closes, second only to Anywhere’s 180,000 agents. Wow. But then the next day…
Shortly after the Wall Street Journal published their story, the CEO of Berkshire Hathaway sent a note to their affiliates that there wasn’t a sale, nor were they contemplating a sale. Either the WSJ made a grave journalistic error which seems unlikely, or BHHS is trying to goose up the price they’ll get from Compass. In terms of the pros and cons of this event actually happening, it doesn’t seem like anyone spoke directly to the CEO of BHHS. I can honestly say I have no idea whether this is a real deal or not which seems insane. The last word on this seems out of our grasp at the moment and it makes me wonder if we have passed “peak intelligence.” With the cynicism of the current world, the frequency of lies and misinformation on social media, and the speed of news cycles, I find it is a full-time job to remain accurately informed.
Book Recommendation
We went to a well-attended book launch last night for my friend Barry Ritholtz’s latest and excellent new read – How Not to Invest: The ideas, numbers, and behavior that destroy wealth—and how to avoid them. It was a lot of fun catching up with everyone there – he’s got a lot of friends and people who admire his prolific high quality content. His new book will be released on March 18th but you can pre-order now. It is an excellent read and not because he mentioned me four times. Ha.
Did you miss the previous Housing Notes?
Housing Notes Reads
- Manhattan Apartment Rents Jump to Record as Bidding Wars Spread [Bloomberg]
- The great American real estate brokerage [1000watt]
- Compass reportedly near a deal to acquire HomeServices [Real Estate News]
- Exclusive | Compass in Talks to Buy Warren Buffett’s Real-Estate Brokerage Unit [WSJ]
- HomeServices of America is not for sale, CEO says [Real Estate News]
Market Reports
- Elliman Report: Manhattan, Brooklyn & Queens Rentals 2-2025 [Miller Samuel]
- Elliman Report: Florida New Signed Contracts 2-2025 [Miller Samuel]
- Elliman Report: New York New Signed Contracts 2-2025 [Miller Samuel]
