'Why Rents Haven’t Dropped in New York City' diff viewer (4/5)

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Why Rents Haven’t Dropped in New York City	Why Rents Haven’t Dropped in New York City
2020-06-22 16:02:13 UTC	2020-06-23 21:58:28 UTC (1 day later)
As hundreds of thousands of New Yorkers have fled the city to wait out the coronavirus pandemic, renters who have stayed in their apartments are wondering if and when rents might fall.	As hundreds of thousands of New Yorkers have fled the city to wait out the coronavirus pandemic, renters who have stayed in their apartments are wondering if and when rents might fall.
With so many fewer people in the city and the region just now taking tentative steps toward reopening, many tenants have hoped and believed that landlords, presumably struggling to fill vacancies, would be willing to reduce rents. But those looking to sign or renew leases in the last few months say that while some landlords are grudgingly offering short-term concessions, like a free month of rent, most are unwilling to budge on pre-pandemic pricing and, in some cases, are even increasing rents.	With so many fewer people in the city and the region just now taking tentative steps toward reopening, many tenants have hoped and believed that landlords, presumably struggling to fill vacancies, would be willing to reduce rents. But those looking to sign or renew leases in the last few months say that while some landlords are grudgingly offering short-term concessions, like a free month of rent, most are unwilling to budge on pre-pandemic pricing and, in some cases, are even increasing rents.
“There is a disconnect between what tenants expect and landlords are willing to give,” said Gary Malin, chief operating officer of the Corcoran Group. “So far, landlords are getting rent and not sitting on vacancies, so they’re not giving 30 percent discounts.”	“There is a disconnect between what tenants expect and landlords are willing to give,” said Gary Malin, chief operating officer of the Corcoran Group. “So far, landlords are getting rent and not sitting on vacancies, so they’re not giving 30 percent discounts.”
As the pandemic hobbled huge sectors of the economy, there were dire predictions that many tenants would not be able to pay their rent. But rent collection has remained surprisingly strong during the spring. In New York, a statewide moratorium on evictions passed on March 20 and later extended through Aug. 20 gave renters a reprieve, but because they were still legally obligated to pay their rent, and had to negotiate any rent forgiveness individually with their landlords, many were compelled to continue paying.	As the pandemic hobbled huge sectors of the economy, there were dire predictions that many tenants would not be able to pay their rent. But rent collection has remained surprisingly strong during the spring. In New York, a statewide moratorium on evictions passed on March 20 and later extended through Aug. 20 gave renters a reprieve, but because they were still legally obligated to pay their rent, and had to negotiate any rent forgiveness individually with their landlords, many were compelled to continue paying.
Through May 20, landlords across the country reported that they had received 90.8 percent of rents, compared with 93 percent a year earlier. Government aid and informal negotiations between landlords and tenants likely helped stabilize the situation, but as the aid money dwindles in the coming months, collection rates are likely to drop.	Through May 20, landlords across the country reported that they had received 90.8 percent of rents, compared with 93 percent a year earlier. Government aid and informal negotiations between landlords and tenants likely helped stabilize the situation, but as the aid money dwindles in the coming months, collection rates are likely to drop.
In April and May, rents in New York City actually went up year over year, according to StreetEasy’s Rent Index, which measures growth over time. From April to May, rates stayed essentially flat, but year over year May rents were up 0.7 percent in Manhattan, to $3,273, and 3.7 percent in Brooklyn, to $2,744. That’s a smaller annual increase than normal, but an increase nonetheless.	In April and May, rents in New York City actually went up year over year, according to StreetEasy’s Rent Index, which measures growth over time. From April to May, rates stayed essentially flat, but year over year May rents were up 0.7 percent in Manhattan, to $3,273, and 3.7 percent in Brooklyn, to $2,744. That’s a smaller annual increase than normal, but an increase nonetheless.
But discounts crept up, too, according to StreetEasy economist Nancy Wu. In May, the number of discounted rentals on the site climbed to 24 percent, up from 14.5 percent in May 2019, according to a StreetEasy analysis. And the discounts were bigger, too — 7.9 percent of the total asking rent, up from 4.8 percent in 2019.	But discounts crept up, too, according to StreetEasy economist Nancy Wu. In May, the number of discounted rentals on the site climbed to 24 percent, up from 14.5 percent in May 2019, according to a StreetEasy analysis. And the discounts were bigger, too — 7.9 percent of the total asking rent, up from 4.8 percent in 2019.
Jeffrey E. Levine, founder and chairman of Douglaston Development LLC, said that during the first two months of the pandemic, there was no change in occupancy numbers at Douglaston’s properties and that rent collection rates hovered around the 90th percentile for market-rate properties — down from 98 to 99 percent in a typical year, but not as much as they’d feared.	Jeffrey E. Levine, founder and chairman of Douglaston Development LLC, said that during the first two months of the pandemic, there was no change in occupancy numbers at Douglaston’s properties and that rent collection rates hovered around the 90th percentile for market-rate properties — down from 98 to 99 percent in a typical year, but not as much as they’d feared.
“In May, we did start to see people leaving the buildings, people who’d had their jobs affected by the virus or were relocating outside the city, increasing vacancy rates,” Mr. Levine said. “That, combined with not being able to do real tours, made us decide to offer current and new prospective tenants up to one month free for renewal or a new lease.”	“In May, we did start to see people leaving the buildings, people who’d had their jobs affected by the virus or were relocating outside the city, increasing vacancy rates,” Mr. Levine said. “That, combined with not being able to do real tours, made us decide to offer current and new prospective tenants up to one month free for renewal or a new lease.”
But while many landlords prefer a one-time deal, renters are often wary of such agreements because they pave the way for a rent hike the next year.	But while many landlords prefer a one-time deal, renters are often wary of such agreements because they pave the way for a rent hike the next year.
Chase Kreuter, who started looking for a one-bedroom in Murray Hill this spring, didn’t want to sign a lease with promotional pricing for that reason. Her broker, Matt Bauman, the founder of Bauman Realty, was able to find an apartment in a doorman elevator building on East 29th Street with an actual — not net-effective — rent of about 8 percent less than it would normally be for this time of year, but the negotiations ended there.	Chase Kreuter, who started looking for a one-bedroom in Murray Hill this spring, didn’t want to sign a lease with promotional pricing for that reason. Her broker, Matt Bauman, the founder of Bauman Realty, was able to find an apartment in a doorman elevator building on East 29th Street with an actual — not net-effective — rent of about 8 percent less than it would normally be for this time of year, but the negotiations ended there.
“I was trying to get them to lock in a two-year lease, or agree to a rate for next year,” Mr. Bauman said. “They weren’t budging. They were willing to offer these rates now, but think by next year it will be back to normal.”	“I was trying to get them to lock in a two-year lease, or agree to a rate for next year,” Mr. Bauman said. “They weren’t budging. They were willing to offer these rates now, but think by next year it will be back to normal.”
When Cody Stockton’s landlord asked for a 1.5 percent increase on his $3,250 three-bedroom share in Bedford-Stuyvesant for a July 1 renewal, the 22-year-old financial researcher aggregated rents for every three-bedroom apartment he found on StreetEasy within a three-mile radius. After finding that the average rent was $2,996, Mr. Stockton offered to re-sign at $3,100. The landlord countered with a free month, but still wanted the 1.5 percent increase, which would have averaged out to $3,025 a month — $75 less a month than Mr. Stockton had offered. Mr. Stockton said he wouldn’t re-sign on principle.	When Cody Stockton’s landlord asked for a 1.5 percent increase on his $3,250 three-bedroom share in Bedford-Stuyvesant for a July 1 renewal, the 22-year-old financial researcher aggregated rents for every three-bedroom apartment he found on StreetEasy within a three-mile radius. After finding that the average rent was $2,996, Mr. Stockton offered to re-sign at $3,100. The landlord countered with a free month, but still wanted the 1.5 percent increase, which would have averaged out to $3,025 a month — $75 less a month than Mr. Stockton had offered. Mr. Stockton said he wouldn’t re-sign on principle.
“Yes, we get a month free, but you’re still charging more,” he said. “I don’t want to move, but there’s a place right down the street, a newer property, that’s renting for less.”	“Yes, we get a month free, but you’re still charging more,” he said. “I don’t want to move, but there’s a place right down the street, a newer property, that’s renting for less.”
Brokers and experts attribute the stubbornly high rents to a lack of inventory: By the end of April, the number of new rental listings on the market had fallen 33 percent from 2019, according to StreetEasy, resulting in the fewest new leases on record for the month of May in a decade, according to real estate brokerage Douglas Elliman. Many renters whose leases were up this spring decided not to move, working out extensions or renewals instead. Demand is down, too, although many temporary price drops, discounted sublets and other deals offered to existing tenants aren’t reflected in the data.	Brokers and experts attribute the stubbornly high rents to a lack of inventory: By the end of April, the number of new rental listings on the market had fallen 33 percent from 2019, according to StreetEasy, resulting in the fewest new leases on record for the month of May in a decade, according to real estate brokerage Douglas Elliman. Many renters whose leases were up this spring decided not to move, working out extensions or renewals instead. Demand is down, too, although many temporary price drops, discounted sublets and other deals offered to existing tenants aren’t reflected in the data.
“New leases are only about a third of the market, and the new leasing activity you’re seeing now is down 70 percent year over year,” said Jonathan Miller, of the appraisal firm Miller Samuel. “Right now the market data is massively distorted. I think it’s pretty clear if you remove the distortion, rents are already going down.”	“New leases are only about a third of the market, and the new leasing activity you’re seeing now is down 70 percent year over year,” said Jonathan Miller, of the appraisal firm Miller Samuel. “Right now the market data is massively distorted. I think it’s pretty clear if you remove the distortion, rents are already going down.”
Landlords are often open to negotiation and price cuts — up to a point. Sudha Sahai owns a total of six furnished apartments in the East Village and Gramercy, which she typically rents by the month as corporate housing. When the pandemic hit in March, she listed one of the units, a one-bedroom in the East Village, for $6,000 a month with Bill Kowalczuk, an associate broker at Warburg Realty.	Landlords are often open to negotiation and price cuts — up to a point. Sudha Sahai owns a total of six furnished apartments in the East Village and Gramercy, which she typically rents by the month as corporate housing. When the pandemic hit in March, she listed one of the units, a one-bedroom in the East Village, for $6,000 a month with Bill Kowalczuk, an associate broker at Warburg Realty.
After the apartment sat on the market for a few weeks, Ms. Sahai told Mr. Kowalczuk to knock the price down to $5,500. A couple ultimately offered $5,000 for the space, which Mr. Kowalczuk negotiated up to $5,200, with the renters paying the full broker’s fee. “For monthly furnished I get more — so much more I’m not even going to tell you,” Ms. Sahai said. “I wanted it rented.”	After the apartment sat on the market for a few weeks, Ms. Sahai told Mr. Kowalczuk to knock the price down to $5,500. A couple ultimately offered $5,000 for the space, which Mr. Kowalczuk negotiated up to $5,200, with the renters paying the full broker’s fee. “For monthly furnished I get more — so much more I’m not even going to tell you,” Ms. Sahai said. “I wanted it rented.”
~~Updated June ~~22,~~ 2020~~	Updated June 16, 2020
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The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth.	The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth.
The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave.	The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave.
So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement.	So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement.
Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.	Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.
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The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April.	The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April.
	Mass protests against police brutality that have brought thousands of people onto the streets in cities across America are raising the specter of new coronavirus outbreaks, prompting political leaders, physicians and public health experts to warn that the crowds could cause a surge in cases. While many political leaders affirmed the right of protesters to express themselves, they urged the demonstrators to wear face masks and maintain social distancing, both to protect themselves and to prevent further community spread of the virus. Some infectious disease experts were reassured by the fact that the protests were held outdoors, saying the open air settings could mitigate the risk of transmission.
States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people.	States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people.
Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.	Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.
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	Taking one’s temperature to look for signs of fever is not as easy as it sounds, as “normal” temperature numbers can vary, but generally, keep an eye out for a temperature of 100.5 degrees Fahrenheit or higher. If you don’t have a thermometer (they can be pricey these days), there are other ways to figure out if you have a fever, or are at risk of Covid-19 complications.
	The C.D.C. has recommended that all Americans wear cloth masks if they go out in public. This is a shift in federal guidance reflecting new concerns that the coronavirus is being spread by infected people who have no symptoms. Until now, the C.D.C., like the W.H.O., has advised that ordinary people don’t need to wear masks unless they are sick and coughing. Part of the reason was to preserve medical-grade masks for health care workers who desperately need them at a time when they are in continuously short supply. Masks don’t replace hand washing and social distancing.
If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.	If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.
If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested.	If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested.
Mr. Kowalczuk described that deal as a fair one, but said that many renters are being unrealistic. He’s been regularly fielding offers at 20 to 50 percent below asking prices. One opportunistic renter even tried to finagle a 10-year lease on the Gramercy Park townhouse Ms. Sahai owns, at a 70 percent discount.	Mr. Kowalczuk described that deal as a fair one, but said that many renters are being unrealistic. He’s been regularly fielding offers at 20 to 50 percent below asking prices. One opportunistic renter even tried to finagle a 10-year lease on the Gramercy Park townhouse Ms. Sahai owns, at a 70 percent discount.
A lot of landlords also feel that when real estate agents begin to show properties again during Phase 2 of New York City’s reopening plan — Gov. Andrew Cuomo said Wednesday that the city is set to begin Phase 2 on Monday — there will be a surge of pent-up demand. As brokers pointed out, landlords who have waited this long want to see that play out before cutting prices.	A lot of landlords also feel that when real estate agents begin to show properties again during Phase 2 of New York City’s reopening plan — Gov. Andrew Cuomo said Wednesday that the city is set to begin Phase 2 on Monday — there will be a surge of pent-up demand. As brokers pointed out, landlords who have waited this long want to see that play out before cutting prices.
“It’s going to be a compression of a spring, summer and fall market,” said Jared Antin, the director of sales at Elegran, a New York brokerage. “If you were intending to move you’re still intending to move. We’ve actually seen bidding wars for some of our properties.” Among them was a three-bedroom townhouse in Prospect Lefferts Gardens asking $5,900 that garnered multiple offers after being on the market for just a day, he said.	“It’s going to be a compression of a spring, summer and fall market,” said Jared Antin, the director of sales at Elegran, a New York brokerage. “If you were intending to move you’re still intending to move. We’ve actually seen bidding wars for some of our properties.” Among them was a three-bedroom townhouse in Prospect Lefferts Gardens asking $5,900 that garnered multiple offers after being on the market for just a day, he said.
But those who watch the market closely say that, as the economic recession sets in, prices will most likely fall, if not very fast and not by much at first. At least initially, people may not see big discounts, according to Mr. Miller, but general conditions convey a sense of weakness in the rental market.	But those who watch the market closely say that, as the economic recession sets in, prices will most likely fall, if not very fast and not by much at first. At least initially, people may not see big discounts, according to Mr. Miller, but general conditions convey a sense of weakness in the rental market.