Rents Are Roaring Back in New York City (Published 2022) (2024)

Gabbie Fried, an actor and comedy writer, had lived in New York City for 10 years and had never been able to afford her own place. Then, last February, she found a one-bedroom apartment she liked on the Upper West Side. At $1,945 per month, it was tantalizingly close to her price range — she moved in.

Ms. Fried, 27, knew that a pandemic rebound was driving up housing costs and expected her rent would increase when her lease ended at the end of March. But when she learned what she would have to pay, she was floored.

“When I got home and opened that letter, saw an $800 increase, I had an absolute breakdown because I absolutely cannot afford that,” she said. She is moving out.

That kind of sticker shock is reverberating across the city.

After the pandemic swept in two years ago, rents in New York and several other major American cities plunged, as fear of the virus and the lockdown of urban economies prompted waves of people to leave. But with the virus receding and a sense of normal life slowly returning, many big cities are regaining their appeal, helping fuel a nationwide surge in housing costs and pushing some residents out of homes they can no longer afford.

In few places is that phenomenon more stark than in New York, a city where renters make up two-thirds of all households.

Rents in New York rose 33 percent between January 2021 and January 2022, according to the online listing site Apartment List, almost double the national rate and the highest increase among the 100 largest American cities tracked by the group.

“We’re seeing that rents have returned and basically surpassed where they were prepandemic,” Nancy Wu, an economist with StreetEasy, a real estate website, said of rents across New York.

The declines and increases have been much sharper in wealthier neighborhoods.

On the Upper West Side and in Williamsburg, Brooklyn, the median asking rent dropped by roughly 20 percent between January 2020 and January 2021. But over the past year they have spiked by around 40 percent and in both neighborhoods, rents are higher than they were before the pandemic.

The fluctuations reflect a sharp turnaround driven in large part by the end of the discounts landlords used to keep and attract tenants during the pandemic. Some property owners say they are adjusting for the booming housing market, making up for lost income and compensating for the escalating cost of utilities and property taxes.

But the increases have underscored the city’s chronic and worsening problems with affordability, pushing many New Yorkers into desperate negotiations with landlords or simply to leave.

“It just doesn’t seem to be getting better, and I think certainly the feeling out of this pandemic is that it’s just getting worse,” said Rachel Fee, executive director of the New York Housing Conference, a nonprofit advocacy group. “It’s just sort of mind boggling, the increases we’re seeing now.”

Underlying much of the increase in New York and elsewhere is a mismatch between supply and demand.

For years many cities have not built enough housing to keep up with population and job growth. That was exacerbated during the pandemic, as supply chain snags and labor constraints further slowed construction.

But more people also want homes. Many young people in their 20s and 30s are increasingly seeking their own places to live, Mr. Salviati said, after delaying those decisions during the height of the pandemic.

The spiraling cost of homeownership has had a cascading impact on the rental market. With the appetite for single-family homes and condominiums driving up their cost, some people eager to buy are instead opting to rent, pushing up rental prices.

“There are a ton of households looking to rent apartments,” said Jenny Schuetz, a housing researcher at the Brookings Institution. “They run the gamut by age and income and household type and we just haven’t been building enough apartments for the last 10 years, and in some cases for longer than that.”

Rising rents hit New Yorkers particularly hard because households in the city rent at twice the national rate. More than a quarter of those households are considered “severely rent-burdened,” meaning they spend more than 50 percent of their income on rent.

Though roughly half of all rental units in New York, including public housing, are rent regulated, limiting increases, about 43 percent, totaling 2.1 million units, are subject to market forces.

And while rent increases have been smaller in less-affluent neighborhoods, that has still left many lower-income tenants struggling. A $2.1 billion state pandemic rent relief program has basically run out of money.

On the Upper West Side, Ms. Fried said she tried to negotiate a lower rent increase, making the case that she always paid on time.

But the property manager, HRM Management Corp., rejected a reduction, noting in an email to Ms. Fried that “with the improving market conditions and the city now fully open, landlords are in a better position now than in 2020.”

Ms. Fried’s $1,945 rate, the email added, had amounted to a “pandemic rent.”

“As a smart consumer, we completely understand if you decide to look at other units,” the property manager said.

Ms. Fried’s landlord did not respond to requests for comment.

Ann Korchak, a member of the Small Property Owners of New York, a landlord group, whose family owns two properties on the Upper West Side, said she provided a discount to some of her tenants.

In one case, she dropped the rent about 17 percent, and said she plans to raise it again by at least 17 percent when the lease is up this year. Ms. Korchak declined to provide specific dollar amounts.

“I gave her flexibility and I had the benefit of a reliable tenant, even though I was collecting less rent,” she said. “Now I’m at the point where I need to kind of get back to the real world.”

For some households, increases are prompting departures.

Madeleine Hyde, 35, moved with her husband to a ground floor, two-bedroom apartment in a brownstone in Park Slope, Brooklyn, in December 2020. The rent had been slashed from $3,800 to $3,000.

It felt like the perfect place to put down roots and raise a family, said Ms. Hyde, who gave birth to a boy in July 2021. But the landlord told the family that it planned on raising the rent by $1,000 at the end of their yearlong lease, which Ms. Hyde, a teacher, and her husband, who managed a brewery, could not afford.

After negotiating, the landlord proposed a $600 increase, which the couple still felt they could not pay. They moved at the end of January to Ms. Hyde’s parents’ home in Yonkers. Ms. Hyde’s commute, which had been 30 minutes to her school in Battery Park City, is now about 90 minutes.

Still, she considers herself lucky to have a place to stay.

“I have no idea what we would have done,” she said. “We would have gone into an extreme amount of debt.”

Ms. Hyde’s landlord did not respond to a request for comment.

In some cases, the rent increases are stoking tensions between landlords and lower-income tenants.

Manuel Bejaran, 63, a taxi driver, has lived in his one-bedroom apartment in Inwood, in northern Manhattan, since 1997. In January, the landlord told him the rent was going up to $1,800 from $1,250, noting that the price of water and gas had increased, Mr. Bejaran said. Mr. Bejaran called the increase “an abuse.”

Mr. Bejaran’s landlord did not respond to requests for comment.

“He’s doing whatever he feels like,” Mr. Bejaran said of the landlord. “He doesn’t respect the tenants.”

Karen Zraick contributed reporting.