New York employees face the biggest unemployment rate since 2003 with a total of 8.1 percent of the workforce being out of a job. This has resulted in a slowing demand of rentals in the city and particularly in Manhattan. Figures have shown that rents have fallen by 5.9 percent since the same time last year in March 09.
The lack of demand is in direct relation to the current unemployment situation in the country and people’s need to make some serious decisions about the financial situation in their lives.
As more and more employees are forced from their jobs through job cuts, they struggle to come up with the finances to pay for rent in the city. Even so the average rent has declined tremendously for all types of apartments, vacancy rate has topped 2 percent for the fifth month in a row.
Studio apartments rents dropped to an average of $1,812 (2.1 percent), one-bedroom units range around $2,595 (a loss of around 5.9 percent) and the cost of rent for a two-bedroom home is down to $3,631 (a decline of 2.2 percent). Throughout the market figures have steadily declined in the last few months.
Mr William Thompson, a city employee predicted back in March that New York City would lose 250,000 jobs before the recession ends.
Many people are unemployed right now and find it already tough to put a roof over their heads.
Some landlords are forced to offer concessions to help their own rental income while helping people at the same time. Many offer a month of free rent which lowers the expenditure for those looking to save money.
Even the most of luxurious apartments are standing empty, devoid of people altogether. One such place is Trump Place at 220 Riverside Blvd. A total of 25 apartments are now available for rent, 13 of them for reduced prices, according to the property listing service Streeteasy.com.
A massive 700 square-foot one-bedroom apartment in the tower is on the rental market for $3,800 a month, 10 percent less than back in November 2008.
Citi-Habitats stated that vacancy rates of Manhattan apartments had reached 3.8 percent back in October 2002.
But New York’s Manhattan isn’t the only city to suffer. Similar declines have been seen around the country with vacancies climbing to 7.2 percent in the first quarter from 6 percent a year earlier and 6.6 percent in the fourth quarter according to Reis Inc., a New York-based research firm.