The "NY is dead" gang is eating up their words and returning to the city. But bad news awaits them as rent prices are going absolutely wild in New York and other metropolitan cities in America. Why? Everyone is coming back at the same time with employers calling them back and schools re-opening. They are arriving to find bidding wars and skyrocketing prices in their former neighborhoods.
In Manhattan, the median monthly rent for a 1-bedroom apartment was $3,400 in October, up 11% from last year, while a 2-bedroom was $5,158, up 20% from a year ago.
Doorman buildings are especially in high demand. The median rent for apartments in doorman buildings, was $4,263, up 25% from last year and also 8% above their pre-pandemic levels from two years ago.
The sales market is showing a similar pattern. In Q2'21 home sales in LA more than doubled from the same period of last year, reaching the highest total tracked since 2004, while the median sales price rose annually for the ninth consecutive quarter. In Manhattan, the third quarter saw 4,523 home sales, the highest number in more than 30 years.
Sam Moritz, who was interviewed by WSJ, gave up his Bushwick apartment in September '20 and relocated to Salt Lake City. "Things were going really well, I had built a whole life for myself,” he said. He tried skiing and hated it and also did not appreciate how small the city was. “It’s a very small, sleepy city, I was used to the excitement of New York.”
Short Squeez Takeaway: Lesson of the day is that you should not have left your 2 square-inch apartment in Manhattan because you probably can't afford those 2 square-inches anymore. For anyone looking to rent, there is hope. The rental market tends to slow down across the country as winter sets in so maybe try returning from your cabin in Wyoming then.