Is the NYC Rental High Price Apocalypse Over?

The Weekly Recap

The IRS says Microsoft owes $29 Billion in back taxes, the Fed is divided on the future of rate hikes although higher bond yields are likely to extend the rate pause. Banks have seen a $280 Billion boost thanks to increased rates. The House of Representatives is still without a speaker, US job growth in September keeps moving ahead strong as wage inflation is cooling and Hamas reminds the world that absolute and total evil still exists.

Is the NYC Rental High Price Apocalypse Over?

Believe it or not, the scourge of high rental prices in NYC may have turned a corner.

In September, the median price to rent an apartment in Manhattan dropped $50 from the record-breaking high of $4,400 in July and August. So, congratulations folks, we’re beginning to trend in the right direction after hitting what seemed like monthly record highs every single month.

Concessions are even slowly starting to come back as 12% of new leases in September offered some sort of concession to tenants indicating that the massive demand we’ve been seeing may be starting to wane. Historically. the vacancy rate in NYC hovered around 1% and is now currently the highest level since August of 2021 at about 3%.

Although these are all positive indications for the rental market, any sort of major shift to take place market wide is a slow burn. Like most things in life, the NYC rental market is cyclical and now that enough time has passed since the lockdowns of Covid, we should be entering the normal seasonal approach to the marketplace where prices decrease over the late fall into early spring and pick back up as we move into the summer.

Market Performance

Here are how some other indexes and asset classes have performed as of this mornings opening bell.

NYC Market Update

Here is a view of new inventory that has come onto the NYC market over the past week as well as newly signed contracts in Manhattan.

Mortgage Rate Update

For the fifth consecutive week, mortgage rates rose as ongoing market and geopolitical uncertainty continues to increase. The good news is that the economy and incomes continue to grow at a solid pace, but the housing market remains fraught with significant affordability constraints.

News You Can Use

• Higher Bond Yields Likely to Extend Fed Rate Pause Wall Street Journal

• How to Get to 2% Inflation CNBC

• Fed Minutes Show Officials Divided on Future Rate Rise Wall Street Journal

• Fed’s Daly Says Neutral Interest Rate Could Be Higher Than Pre-Pandemic Bloomberg

• Why Mortgage Rates Are so High Axios

• Mortgage Rates Are Getting Closer to 8% Yahoo Finance

• Banks got $280 Billion Boost From Rising Rates Bloomberg

• Wage Inflation Cools As Jobs Numbers Keep Growing Reuters

• New York’s Airbnb Ban is Descending into Pure Chaos Wired

• Deals May Be Down, But NY’s Tech Industry is Still Up Crains

• Treasury’s Debt Deluge Is Finally Straining US Funding Markets Bloomberg

• First US Weapons Arrive in Israel, Biden Calls Hamas Attach ‘sheer evil’ CNBC

• IRS says Microsoft Owes An Estimated $29 Billion in Back Taxes CNBC

The Deep Insight

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