We never thought we would never say it, but Manhattan is getting a little cheaper. Not if you want to shop or go out, but if you want to move into an apartment. As unemployment in the city hit 10 percent, and Wall Street jobs vanished into thin air, rents across the borough dropped 9.4 percent in the fourth quarter, according to a report by broker Prudential Douglas Elliman Real Estate and appraiser Miller Samuel Inc.
People are not just downgrading their lifestyles but also their apartments, moving into smaller, less luxurious spaces, making landlords nervous and ready to strike any deal that will keep the tenant in and the apartment occupied. This means that people looking for a new place to stay now have plenty of options.
When Mona Patel moved to New York last year from Gainesville, Florida, to start a new job, she hit Craigslist to look for a place to stay. Within days, she had narrowed her search to two apartments on the Upper East Side and a few more on the Upper West Side. The differences in the quality, she said, were stunning.
“On the Upper West, some of the places were large, but the conditions were so bad,” she said, adding, in many places, the paint was peeling off the wall and roaches littered the floor. “On the Upper East however, the places were cleaner and I felt I was going to get more bang for my buck.” Mona settled on a large sunny one bedroom apartment on 91st between 1st and 2nd Avenue. It was listed for $1700, but a nervous management company, eager to rent the property dropped the price by $200. Mona didn’t even have to ask. She immediately signed the papers and moved in.
“It is a renter’s market, certainly,” said Michelle Araujo of Gotham Realty Services . “The Upper East Side is outpricing the Upper West. If someone is looking to spend $2400, then I try to move them over to the Upper East,” she said, adding the best deals to be made are on the East Side now. She is currently trying to move a property that that was originally listed for $3400. After finding no takers, the landlord chopped the price to $2250. “The problem, some landlords have, is that they are competing against luxury buildings, that offer so many incentives,” said Araujo. “There’s no way an individual landlord can compete with them,” she added.
Imad Abbas, a luxury rental and sales specialist attests to Arajou’s statement saying luxury buildings have been hit by tenants who have downgraded their digs, forcing them to offer freebies like a month’s free rent, free gym membership and in some cases, a shuttle service to and from the subway. “This is the worst year ever,” Abbas siad.” My friends who have worked in this industry for 30 years, have never seen so many freebies,” he added. Incentives were an important factor in driving rents down–almost 14%, according to a report by CitiHabitats, a residential New York City broker that closed on about 13,000 rental deals during the year
While landlords are twitching to find tenants, Michelle Araujo offers some ideas for people looking to make the switch to a new apartment. “Assess what you want and look for that,” she said. “Do you really need a Doorman, will you really use the Gym downstairs? You can save yourself a lot of money, if you are realistic,” she added. She also said that some tenants scout around for a new place and use that information to re-negotiate their lease with their landlord, offering them a chance to bargain for lower rents. And if you find a good place that seems like a complete steal, Araujo suggests buying the property.
For the best deals on luxury buildings, Abbas suggests looking on the East of 2nd Avenue. “Between 1st and York. That’s where the best deals are,” he said. “The hardest spaces to move are in the 60′s and Third Avenue,” he said, adding, “most people are being frugal and those apartments don’t give as much space compared to Second and York.” Most importantly, keep an eye on the market. Mona’s cousin Asit Patel monitored the market movements and saw prices dipping at the start of the recession. His rent for a two bedroom walk-up on 90th and Lex was $3050. Some key market information, coupled with a quick call to the Real Estate company saw Asit and his roommate re-negotiate their lease to $2550, offering evidence, that knowing the numbers in this market goes a long way.
Brokers, however, expect things to tighten up this Spring. “Once this crop [of renters] is absorbed,” said Douglas Wagner, Executive Director, Bond New York Real Estate, “the next wave will be in April-May, when students come into the city.” He urged apartment hunters to make their move now, adding that prices will escalate in Spring and a lot of the freebies being offered now would be gone. “For New Yorkers, the Upper East is a surprise opportunity- it’s a great time to come over to the East Side,” he said.
This piece originally appeared in an Upper East Side publication–Our Town
