Rent prices were discounted across 34.7 percent of properties in the Big Apple during the second quarter, according to new data from real estate website StreetEasy.
The median asking price fell by 6.7 percent, which is about $221 per month or $2,652 per year, due to reduced demand.
Higher-end apartments saw the largest price cuts – as wealthy buyers have flocked to the suburbs since March.
And prices may be headed even lower in the near future.
“Demand will remain low as new hires, interns and students begin jobs and school remotely, and as many New Yorkers escape the city temporarily or permanently,” Nancy Wu, StreetEasy Economist, told FOX Business. “As inventory piles up due to this lack in demand, even more landlords will need to make rent cuts, and rents will likely drop even further.”
The second quarter of 2020 marked the first time since the Great Recession that there was a year-over-year rent price drop in the metro.
Meanwhile, StreetEasy saw an uptick in interest in Manhattan’s outer boroughs of Queens and Brooklyn.
Wu said remote work makes commuting an insignificant factor in choosing an apartment location, which helps explain an increase in interest in Queens and Brooklyn. That’s a trend that will continue as long as social distancing orders are in place, she predicted.
Rent prices rose in both areas during the second quarter – although at a modest and slower pace.
As previously reported by FOX Business, moving companies said they were experiencing an “insane” uptick in demand as residents looked to leave Manhattan during the pandemic.
While some people were headed to suburbs in the near vicinity, others were picking up and heading to states in the south, like Florida and the Carolinas.
Due to pandemic-related financial fallout, Wu added some people may be moving out as they look to downsize, move into a less expensive property or find temporary housing.
Moving company executives said they expected their busy season to occur between July and September this year, adding there was a lot of pent-up demand to move out.