Tough Luck For NYC Apartment Hunters: Bargains Scarce As Rents Hover Near Record Highs
Tens of millions of Americans have been battered by a multi-year housing affordability crisis, mainly during the Biden-Harris administration's first term. With high interest rates and record-high home prices, many prospective buyers have been sidelined and forced to remain in their parent's basement or stuck in expensive rentals.
Despite a hotter September CPI print, this morning's inflation report offered some good news: "The silver lining is that shelter inflation continues to slow."
Yet rents are still at or near record highs in markets like Manhattan, giving apartment hunters minimal room for deals anytime soon.
Bloomberg cited new data from brokerage Douglas Elliman Real Estate and appraiser Miller Samuel showing that the median rent in the NYC borough slipped 3.4% in September to around $4.2k. Prices also fell in Brooklyn and Queens.
Even though shelter costs in NYC are easing in some boroughs, prices are still near record highs - offering minimal deals for apartment hunters.
Jonathan Miller, president of Miller Samuel, told Bloomberg that while rents typically trend lower in the autumn and winter, only "modest easing" is expected in the coming months, with no significant drops forecasted through the end of the year.
Bloomberg noted, "That's at least partly because the market remains fiercely competitive. The number of newly signed leases in Manhattan surged 40% from a year earlier, and bidding wars broke out in nearly a fifth of those deals."
Miller pointed out that the slight drop in rents last month was due to cheaper mortgage costs that turned some renters into buyers. However, with a recent hot jobs report and Thursday's inflation print, the 30-year fixed-rate mortgage tracked by Bankrate has surged from 6.5% to nearly 7%.
"Think of the direction of rents in terms of the direction of the economy. Wages and employment continue to defy expectations," Miller noted, adding, "Symbolically, the Fed rate cuts are important to the purchase market. But if mortgage rates don't come down, it will stall the decline in rents."
What's often left out from the conversation by leftist media outlets, and correctly pointed out by Sen. JD Vance at last week's vice presidential debate is the topic of the illegal alien invasion stoked by Biden-Harris that is driving up housing costs in various markets: "[Y]ou have got housing that is totally unaffordable because we brought in millions of illegal immigrants to compete with Americans for scarce homes."
The root cause of the affordability crisis is the housing shortage. Biden-Harris importing ten-plus million illegal aliens into the country certainly exacerbated the crisis.