New York Real Estate Market Trends 2021
In July 2021, the New York real estate market continued to surge, with closed sales growing by more than 30 percent from a year ago, according to the most recent housing report released by the New York State Association of REALTORSÂ®. Sales prices reach an all-time high in the face of persistently low inventory. The median sales price in New York State increased 33.3% from $292,545 in July 2020 to $390,000 last month. Year to year, median sales prices have increased by 28.1 percent, rising from $285,000 in 2020 to $365,000 this year.
Inventory remained low in July, with just 44,025 units available, compared to 54,700 in July 2020 â a reduction of 19.5% YTY. In year-over-year comparisons, this is the 20th straight month of falling inventories. Months supply of inventory fell to 3.2 months â a decrease of 38.5 percent from 5.2 months of inventory last July. The housing affordability index decreased by â 24.8% to 100 as compared to July of last year when it was 133. An index of 120 means the median household income is 120% of what is necessary to qualify for the median-priced home under prevailing interest rates. A higher number means greater affordability.
New York’s Recovery From The Pandemic
- New York Cityâs unemployment rate decreased over the month from 10.6% to 10.5%.
- Outside of New York City, the unemployment rate decreased from 5.5% to 5.4%.
- The number of unemployed New Yorkers decreased over the month by 17,100, from 725,700 in June to 708,600 in July 2021.
How Transparentcity Collects Average Rent In Nyc Data
A frequently asked question is how much does an apartment cost in NYC? The apartment cost in NYC is highly dependent on the neighborhood and size. Our figures are calculated based on aggregated listings data acquired directly from NYC management company websites. Listings data only includes management company market-rate apartment availabilities and does not include broker listings. If you are in the market to rent an apartment in NYC and want to rent directly from management companies to save on fees, go to Transparentcity for a full list of no-fee apartment buildings.
Average Rent In NYC Grouped By Neighborhood
Average Rent In NYC Grouped By Bedroom Size And Building Type
Within each Neighborhood, Average Rent in NYC is further divided by Building Types, which fit into 3 categories:
What Is The Average Apartment Size In Manhattan
The average size for a Manhattan, NY apartment is 702 square feet, but this number varies greatly depending on unit type, with cheap and luxury alternatives for houses and apartments alike. Studio apartments are the smallest and most affordable, 1-bedroom apartments are closer to the average, while 2-bedroom apartments and 3-bedroom apartments offer a more generous square footage.
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Differences By Race Ethnicity And National Origin
Black and Hispanic New Yorkers are overrepresented in rental units with maintenance issues1. The Renter-Occupied Homes with 3+ Maintenance Deficiencies by Race and Ethnicity chart below illustrates that 25% of Black New Yorkers and 23% of Hispanic New Yorkers who live in rental units experience 3 or more maintenance deficiencies, as compared to 18% of renters citywide2. Only 9% of White and Asian/PI renters in New York City live in units with 3 or more maintenance deficiencies.
Renter-Occupied Homes with 3+ Maintenance Deficiencies by Race and Ethnicity, 20173
Asian/Pacific Islander renters have the highest rate of rent burden. The Rent Burden by Race and Ethnicity chart below shows that 42% of renters in New York City are rent burdened, which means they are paying more than 30% of their pre-tax income on rent4. Moreover, 23% of renters are severely rent burdened, which means they spend more than 50% of their pre-tax income on rent. Asian/PI renters are rent burdened at the highest rate , as compared to Hispanic , White , and Black renters.
Rent Burden by Race and Ethnicity5
Asian/PI New Yorkers have the largest average household size of 2.96 residents. The Average Household Size by Race and Ethnicity chart below shows that the average household size in New York City is 2.42 residents. Households with White householders are on average smaller than the city average, while households with Hispanic or Asian/PI householders are on average larger.
New York City Food Costs
From pizza to hot dogs to a viable treasure trove of ethnic cuisine options, New York provides it all in terms of food. If you plan to dine out at all in the city, you’ll need to account for those costs in your budget.
A three-course meal for two at a mid-range restaurant will cost you $100, including gratuity.
However, the omnipresent food carts and stalls that adorn New York’s streets will likely be more common food stops for you. The famed $5 hotdog, soda, and chips combo might not be the healthiest meal out there, but it’s delicious, convenient, and cheap.
If you want to keep costs down and enjoy your time in the kitchen, you can expect to pay $3,690 annually or $307.50 monthly for groceries. If you’re feeding a family of four, you can expect to pay $10,806 annually or $900.50 monthly.
Head to your local Aldi for low-cost grocery options. However, if you’re looking for more options and at a slightly higher cost, head to the newly opened Wegmans. This grocery store has earned its cult following. Seriously, check out their cheese section.
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New York City Utilities
The average utility costs in New York City amount to $273.04 monthly or $3,276.48 for the year. This rate accounts for basic utilities, including water, electricity, and gas.
That said, your utility rates may differ based on your personal preferences, your apartment, and your lease agreement.
That said, it’s important to include cell phones and internet service when estimating your utilities.
The average US resident pays $94 monthly for their cell phone service and around $45 for internet service, meaning you’ll need to account for an additional $139 in your budget.
As a new resident, you may qualify for new customer discounts and incentives, so be sure to do your research to find the best deal.
New York City Healthcare Costs
Healthcare is a necessary expense that you’ll have to include in your moving budget.
In New York City, the average resident pays $2,935 annually toward an employer-sponsored health insurance policy, while a family of four pays $7,153.
New York City has several city-operated health clinics dedicated to delivering free or low-cost healthcare. Additionally, you can find information about health insurance enrollment and options on the city’s Health Department webpage.
However, if you need to purchase your own private insurance, head over to Healthcare.gov to find affordable coverage that meets your needs.
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Nycs Rising Rents: Looking Ahead
I expect rental price growth to continue, but not at such a rapid clip, says StreetEasy economist Nancy Wu. Renters began returning to the market in full force this summer, and landlords are taking notice. They are trying to make up for time and money lost during the pandemics lull by raising prices and erasing discounts. Prospective renters should be prepared for tougher negotiations over the next few months as NYC rents continue rising. But I expect price growth and landlord expectations to normalize as we head into the colder months.
The Era Of Pandemic Discounts In Nyc Rents May Be Over
With NYC rents rising, the share of rental discounts around the city is also changing rapidly. Last July, in the midst of the pandemic, 29.1% of rentals in New York City advertised a discount. This July, only 9.1% were discounted a significant drop of 20 percentage points.
In July 2019, during a typical busy summer rental season, 15.6% of rentals were discounted. So this years figure of 9.1% is particularly low. In fact, its the lowest its been in a decade.
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Healthcare Costs In New York
Between insurance, pre-existing conditions and changing prescription prices, it’s hard to navigate the healthcare system no matter what state you’re in. Here are a few general guidelines on New York healthcare.
In Manhattan, you have access to more than a handful of hospitals depending on where you’re located on the island. You have access to quality healthcare at Mount Sinai, New York-Presbyterian and Lenox Hill, among others.
The cost of living in New York for healthcare costs is about 9.8 percent above the national average. A doctor’s visit will set you back $106.72 on average, while a prescription drug, without insurance, costs upwards of $442.91 on average.
Inflation Gauge Should Be Hot Again In September And For The Months Ahead
With the return of nicer weather and the COVID vaccine distribution going further prices began to climb back up, according to the report. Rather than being down a third, rates were down just 10 percent by the start of summer. By the end of the summer, with many things reopening once again, rent prices had gone up eight percent year-to-year, Apartment Guide said in their report.
Any loses from the pandemic were washed away between Aug. 2020 and Aug 2021, as one-bedroom apartment prices rose 36 percent over that time. Nationally, those same jumps were just under nine percent, showing just how much NYC’s prices were spiking compared to the rest of the U.S.
While the one-bedroom apartments proved to be the most volatile when it came to price, two-bedroom apartments were steadier, the report found, but were not without their highs and lows as well. Those units saw their biggest plunge in Feb. 2021, when it dropped almost 18 percent year-over-year.
Prices for two-bedroom units bottomed out around $4,900 first in Aug.-Sept. 2020, and after a brief uptick, went back to those levels for the first few months of 2021, the Apartment Guide report stated.
But for those looking for a bargain, there may be some hope, according to the report. Over the course of the latter part of the summer , the average price for both one- and two-bedroom units fell more than two percent and nearly five percent, respectively. That could be due to overcorrection, but it is still too early to tell.
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The Cost Of Rent And Housing In Each Borough
While overall, New York City is an expensive place to live, NYC housing prices vary by borough and can even be vastly different from neighborhood to neighborhood. The average rent in a Manhattan neighborhood known for trendy bars and shops will likely be more expensive than a family-friendly neighborhood in Staten Island. Many factors, including square footage, distance to public transportation, and overall location, play a part in how expensive a particular neighborhood is.
The average rent in New York City is $4,208 in Manhattan, $2,951 in Brooklyn, and $2,568 in Queens, according to data from apartment listing service RENTCafé. Believe it or not, the average rent in certain Manhattan neighborhoods is even higher than that. A months rent in both Little Italy and TriBeCa, among the more popular neighborhoods, costs an average of $5,607. Thats the highest average rent in all of New York City!
In fact, the top ten neighborhoods with the most expensive average rent are all located in Manhattan. These are the neighborhoods with the highest average rent in New York City:
The Legislation On The Table Will Increase Nyc Rental Rates
There are around a million rent-stabilized apartments in New York City. There are several bills in the Democrat-controlled state senate and a massive tenantâs rights push that will likely lead to tighter restrictions on landlords. For example, it would be harder to get apartments removed from the rent-stabilization policy and limit the ability of landlords to raise rents after existing tenants move out.
While this hurts landlords who own rent-controlled properties, stricter rent control rules result in a reduction in housing supply and rents going up five percent more than they would have otherwise. Conversely, landlords who donât want to deal with the hassle anymore may be willing to sell properties at a discount simply to get out from under the oppressive regulations.
Disclaimer: Covid-19 may have impacted the NYC real estate market in a way that is not 100% accurately reflected here. When referencing the data published on this page for investment-related decisions, please keep in mind that the data provided here is not solely responsible for depicting the market’s current reality.
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New York City’s Expanding Luxury Development
New Yorkâs rent control laws donât apply to luxury units, and developers have chosen to build these instead of the affordable housing the city needs. However, this development isnât limited to the densest parts of New York City. For example, Staten Islandâs North Shore is seeing new luxury condo construction. Interest in the area is driven by both the improved transit via the new ferry service and luxury buyers seeking relative bargains. This is aside from the oversupply of luxury penthouse units in the NYC housing market.
Other Expenses To Consider In New York City
The budget for your move to New York City should be airtight, meaning you’ll have to account for the expenses that typically get forgotten on most budgets.
We’ve got you covered with an in-depth look at the hidden costs of living in New York City.
- Sales Tax: The combined city and state sales tax rate in New York City is 8.5%, but can vary depending on what you purchase and its cost.
- Income Tax: New York State levies an income tax rate on a sliding scale. Depending on your income, you can expect to pay anywhere from 4% to 10.90% in income tax. Additionally, you’ll have to pay the city’s imposed income tax which ranges from 3.078% to 3.876%, depending on your income.
- Parking Costs: The average cost of monthly parking in New York is $570 per month or $6,840 annually. You’ll have to consider this cost on top of the 10.375% tax and an additional 8% surtax on parking, garaging, or storing cars in Manhattan.
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Cost Of Living In Nyc: Transportation
The same BLS report mentioned above found that New Yorkers spend approximately 12.5 percent of their budget on transportation. The national average is 16.8 percent. Residents of the New York metropolitan area spend about $9,255 annually on transportation, which the U.S. Bureau of Labor Statistics breaks down into:
|Buying, operating, and maintaining private vehicles||79.8%|
Translation? New Yorkers spend more on public transportation, less on private vehicles, and less overall on transportation compared to the national average.
Most New Yorkers dont have cars because of the quality of the citys public transportation system and the added expenses of vehicle ownership. Two of those expenses are parking and gas. While parking in the outer boroughs is slightly less expensive than in Manhattan, a 2017 and 2019 study found the following:
- Average Cost of Parking: $606.37 per month
- Average Price of Gas: $3.08 per gallon
- Average Insurance Rate: $4,400 per year
In each case, this is more expensive than the national average. While New York has one of the best public transit systems in the United States, it is also one of the most expensive:
|City||Cost of Monthly Transit Pass|
|New York City|
More Insight Into Nyc Rental Market Trends
The StreetEasy Market Report shows that the NYC real estate recovery has begun. The tide has shifted in both the rental and sales markets. Recent rent reductions, combined with the city’s reopening and the vaccine’s rollout, have significantly enticed renters to return. NYC rental market has reached a tipping point where rents are starting to rise again.
The City-Wide Trends Show That Real Estate Recovery in New York City is Underway
- The median asking rent in the city has remained unchanged for the past six months at $2,500.
- For the first time since the pandemic, median asking rents in Manhattan, Brooklyn, and Queens increased from the previous month in May.
- The median asking rent in Manhattan increased by $60 to $2,860.
- It was up $49 to $2,449 in Brooklyn.
- In Queens, asking rents increased by $50 to $2,100.
- On the sales front, inventory has begun to normalize after plummeting last summer, followed by a falling spike to record highs.
- In May, there were 21,556 homes for sale on StreetEasy.
- The number of homes under contract remained exceptionally high in the three boroughs, at just over 3,200.
- However, it is beginning to level off in comparison to the massive month-over-month spikes seen since the beginning of 2021.
- Homes on the market in New York City sold faster in May than in any other month this year.
- In May, the average New York City home was on the market for 56 days.
- This is a decrease from 68 days in April and a significant decrease from 116 days in January 2021.
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Cost Of Living In Nyc: Rent
The U.S. Bureau of Labor Statistics found that housing is the largest expenditure category for New Yorkers, making up 38 percent of their overall budget in 2018-19. In comparison, the U.S. average is 32.7 percent.
Rent prices will vary by neighborhood, so this guide will look at average rent overall in NYC as well as average rent in favorite neighborhoods and across housing in the five boroughs.
As of March 2019, these were the median rents for apartments in New York City compared to apartments nationally:
New York hopefuls can control these costs somewhat based on the neighborhood they choose for their housing. In 2018, Business Insider compiled average rent prices for Manhattans 28 neighborhoods, listed here from least expensive to most expensive:
Studio and one-bedroom apartments in Manhattan are on the lower end of the above averages, while two-bedroom apartments are slightly more expensive. Of course, you cant forget about New York Citys other boroughs. As of 2017, here are the average rents for each borough:
Looking to find housing in one of these five boroughs? Save by renting already furnished apartments in NYC and apartments that offer flexible, short-term leases.