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Daily Archives: July 21, 2020
COVID-19 Transforms Peak Rental Shopping Season in NYC
Changes in renter priorities result in a record number of discounts on Manhattan rentals
New York, NY – July 17, 2020 (PRNewswire) As New York City faced the worst impacts of the coronavirus pandemic in the second quarter of 2020, the city’s real estate market reeled. Demand for rentals plummeted at a time when it normally rises, interest in the outer boroughs shot upward, and rents in Manhattan fell for the first time since the Great Recession, according to StreetEasy’s Q2 2020 Market Reportsi.
The period saw a record high for rental discounts in Manhattan: 34.7 percent of all borough rentals received a discount. Landlords cut a record 6.7% off the median asking rent in the borough, equivalent to $221 per month for the median apartment.
The same drop in demand also caused the StreetEasy Manhattan Rent Indexii to fall year-over-year for the first time since the Great Recession, sinking 0.9% to $3,236.
Yet while demand for new rentals fell, interest in those same apartments — as measured by anonymized StreetEasy user search data — rose over last year, especially in the outer boroughs. Stay-at-home-orders drove a flood of interest in online resources and home shopping, and StreetEasy searches for rentals in all three boroughs analyzed increased over last year.
Brooklyn saw the biggest jump in user interest, with 26% more searches than 2019, while Queens searches rose 24%. Even searches for Manhattan rentals increased at 15% year over year. This data suggests that in addition to renters with expiring leases who were looking to move, many were watching curiously to see how the pandemic might impact New York City’s historically high rents.
Landlords, meanwhile, responded to the stay-at-home restrictions with a surge in virtual tour offerings. During the second quarter, real estate agents and landlords uploaded 54 times more walkthrough videos, and 10 times more floorplans, on rental listings than they did in the first quarter.
“Commuting to the office and living in the center of the city were simply not on the list of priorities for renters during this past quarter, and landlords reacted by slashing rents and trying new tactics in order to attract tenants,” says StreetEasy EconomistNancy Wu.
“Landlords are in for a much slower than normal summer rentals season, even as the city slowly begins to reopen. Remote work has given many renters the option to live anywhere they please, making it too soon to predict when rents will rebound.”
See below for additional sales and rental market trends across Manhattan, Brooklyn, and Queens.
Rents and Home Prices Fall in Manhattan
The pandemic and surrounding health precautions caused the first year-over-year drop in Manhattan rents since the Great Recession. The StreetEasy Manhattan Rent Index fell 0.9% to $3,236. Rents dropped the furthest on the borough’s most expensive apartments, with the top quintile, or the most expensive 20% of the market, seeing a 1.4% decrease in rents to $6,325. Sales prices also fell, with the StreetEasy Manhattan Price Indexiii down 4.1% from last year to $1,062,276.
Brooklyn Home Prices Drop at Fastest Rate in 7 Years
The StreetEasy Brooklyn Rent Index increased 2.6% to $2,728, the slowest pace of growth since the fourth quarter of 2018. More than 1 in 4 (25.6%) rentals were discounted during the second quarter, an increase of 8.6 percentage points year-over-year. The StreetEasy Brooklyn Price Index fell 1.6% to $687,160, marking the largest year-over-year drop in home prices in seven years. Sales inventory was down 31.5% compared to the second quarter of 2019.
Queens Rents Climb, But More Slowly
Rents in Queens continued to climb, but at the slowest pace in two years. The StreetEasy Queens Rent Index rose 1.2% to $2,196 during the second quarter. More than one in five (22.5%) rentals were discounted in the borough — an increase of 4.7 percentage points from last year, and the largest share of discounts since the third quarter of 2018. Home prices in Queens remained flat compared to last year at $507,321.
View all StreetEasy Market Reports for Manhattan, Brooklyn, and Queens, with additional neighborhood data and graphics. Definitions of StreetEasy’s metrics and monthly data from each report can be explored and downloaded via theStreetEasy Data Dashboard.
About StreetEasy
StreetEasy is reimagining the way people buy, sell, and rent homes in New York City and New Jersey. Used more than any other local real estate platform, StreetEasy’s website and mobile apps provide vetted and verified listings, plus intuitive search tools and data-driven guides to help people unlock the opportunity of living here. Consumers and real estate professionals can stay up-to-date on the latest real estate trends throughStreetEasy’s Market Reports and explore and download market data for free on theStreetEasy Data Dashboard. Launched in 2006 and based in NoMad, Manhattan, StreetEasy is owned and operated by Zillow Group (NASDAQ: Z and ZG) and is a registered trademark of Zillow, Inc.
i The StreetEasy Market Reports are a monthly overview of the Manhattan, Brooklyn and Queens sales and rental markets. Every three months, a quarterly analysis is published. The report data is aggregated from public recorded sales and listings data from real estate brokerages that provide comprehensive coverage of Manhattan, Brooklyn and Queens, with more than a decade of history for most metrics. The reports are compiled by the StreetEasy Research team. For more information, visit https://streeteasy.com/blog/research/market-reports. StreetEasy tracks data for all five boroughs within New York City, but currently only produces reports for Manhattan, Brooklyn and Queens.
ii The StreetEasy Rent Indices are monthly indices that track changes in rent for all housing types and are currently available from January 2007 in Manhattan, January 2010 in Brooklyn, and January 2012 in Queens. Each index uses a repeat-sales method similar that used to calculate the StreetEasy Price Indices. The repeat method evaluates rental price growth based on homes in a given geography that have listed for rent more than once. More details on methodology here.
iii The StreetEasy Price Indices track changes in resale prices of condo, co-op, and townhouse units. Each index uses a repeat-sales method of comparing the sales prices of the same properties since January 1995 in Manhattan and January 2007 in Brooklyn and Queens. Given this methodology, each index accurately captures the change in home prices by controlling for the varying composition of homes sold in a given month. Levels of the StreetEasy Price Indices reflect average values of homes on the market. Data on the sale of homes is sourced from the New York City Department of Finance. Full methodology here.
SOURCE StreetEasy
Home Shopping Season is in Full Swing After Coronavirus Delay
– Zillow data reveals pending sales grew faster than new listings through June, as buyers are snapping up homes at a record pace
– The typical U.S. home value is $252,178, up 4.3% year over year.
– Rents have dipped slightly this spring in what is usually a period of growth. The typical rent is up 1.5% year over year to $1,723. That’s slower than the 2% annual growth seen last month.
– Despite a small increase in new listings, inventory is down 24.1% from a year ago.
Seattle, WA – July 17, 2020 (PRNewswire) Pre-pandemic forecasts for a frantic home shopping season were put on ice in early spring. But now the frenzy is here — homes are flying off the market as heavy demand combines with limited inventory, according to the June Zillow® Real Estate Market Reporti.
Home values continued their steady, upward trajectory in June, growing 4.3% year over year to $252,178. That’s a slightly faster pace than last month, and the same rate as June 2019 in what has been a stable period for home values.
Phoenix is the hottest top-50 market by a good margin. Home values there are up 9.6% year over year, followed by Birmingham (+7.6%) and Memphis (+7.5%). Chicago (+0.8% year over year) and San Francisco (+1.1%) are the coolest large markets.
Home values in San Jose and Seattle have seen incredible turnarounds over the past year. San Jose home values were falling 9.9% annually as of last June, and they’re now growing at a 5% pace. In Seattle, values were down 0.7% year over year last June, and are now up 7.4% — fourth most in the U.S. among large metros.
“Buyers have come roaring back to the housing market after the initial shock of the pandemic and layoffs faded, and all signs indicate the hot spring selling season we anticipated has shifted to the summer,” said Zillow economist Jeff Tucker. “But those shoppers are competing over a shockingly small pool of homes, causing prices to resume their upward climb after a little softness this spring.”
Spring is typically a season of rent growth, but that hasn’t been the case this year. During the past five years, rents have grown about $30 on average between March and June. This year, the typical rent has fallen $5 nationally over that period, and almost $60 in San Jose and New York.
Despite the slight dip nationally, rents grew in 27 of the 50 largest U.S. metros this spring. And rents are higher than a year ago in 43 of the top 50 metros, led by Memphis (+6% year over year), Phoenix (+5.1%) and Riverside (+4.6%). Rents are down from last year in San Jose (-1.2%), New York (-1%), San Francisco (-0.5%), Washington, D.C. (-0.2%), Baltimore (-0.2%), Houston (-0.1%) and Oklahoma City (-0.1%).
“Rents have felt some impact from the pandemic, stagnating through the spring when we normally see them make most of their annual gains,” Tucker said. “Boosted unemployment benefits and eviction moratoriums have helped keep renters in their homes so far, but as those expire there’s plenty of uncertainty about what comes next.”
Zillow’s weekly data as of the week ending July 11 revealed a small glimmer of hope for inventory as new listings grew 2.1% from the previous week. Still, total inventory fell 1.1% from a week earlier and is now 24.1% lower than at the same time last year, a sign that buyer demand is outpacing the flow of new listings.
Limited inventory is tilting the market toward sellers. Homes typically lasted just 19 days on the market before a contract to sell was signed — a new record in Zillow data that dates back to 2018 — and only 4.2% of active listings had undergone a price cut, down from 5.6% a year earlier. Newly pending sales were up 15% month over month as of the last week of June but have since dipped, down 9.4% from the previous month as of the week ending July 11.
Mortgage rates listed by third-party lenders on Zillow started the month at 3.38% and rose to a peak of 3.48% on June 5. Rates ended June at their monthly low of 3.23%. Zillow’s real-time mortgage rates are based on thousands of custom mortgage quotes submitted daily to anonymous borrowers on the Zillow Group Mortgages site by third-party lenders and reflect recent changes in the marketii.
| Metropolitan Area* | Zillow Home Value Index (ZHVI), June 2020 | ZHVI – YoY Change, June 2020 | Zillow Observed Rent Index (ZORI), June 2020 | ZORI – YoY Change, June 2020 | Total Inventory – YoY Change, Week Ending July 11 |
| United States | $252,178 | 4.3% | $1,723 | 1.5% | -24.1% |
| New York/Newark, NY/NJ | $489,369 | 1.3% | $2,746 | -1.0% | -23.5% |
| Los Angeles-Long Beach-Anaheim, CA | $696,024 | 4.2% | $2,544 | 1.0% | -26.6% |
| Chicago, IL | $243,827 | 0.8% | $1,827 | 0.4% | -23.4% |
| Dallas-Fort Worth, TX | $258,430 | 3.2% | $1,616 | 1.1% | -18.9% |
| Philadelphia, PA | $257,356 | 3.8% | $1,614 | 1.4% | -34.5% |
| Houston, TX | $221,465 | 2.9% | $1,519 | -0.1% | -18.3% |
| Washington, DC | $444,710 | 3.7% | $2,177 | -0.2% | -33.5% |
| Miami-Fort Lauderdale, FL | $307,554 | 3.4% | $1,959 | 1.6% | -10.1% |
| Atlanta, GA | $247,297 | 5.0% | $1,579 | 2.5% | -12.5% |
| Boston, MA | $506,021 | 3.5% | $2,637 | 0.0% | -24.8% |
| San Francisco, CA | $1,119,894 | 1.1% | $3,198 | -0.5% | -10.5% |
| Detroit, MI | $186,409 | 3.8% | $1,224 | 1.7% | -25.5% |
| Riverside, CA | $393,183 | 3.9% | $1,985 | 4.6% | -26.4% |
| Phoenix, AZ | $303,185 | 9.6% | $1,494 | 5.1% | -38.6% |
| Seattle, WA | $547,464 | 7.4% | $2,051 | 1.5% | -21.0% |
| Minneapolis-St. Paul, MN | $302,638 | 4.7% | $1,608 | 1.5% | -35.3% |
| San Diego, CA | $636,815 | 5.0% | $2,355 | 1.8% | -27.6% |
| St. Louis, MO | $183,254 | 3.3% | $1,108 | 2.9% | -39.9% |
| Tampa, FL | $237,427 | 6.0% | $1,551 | 3.3% | -22.9% |
| Baltimore, MD | $298,837 | 1.5% | $1,691 | -0.2% | -25.0% |
| Denver, CO | $454,435 | 3.5% | $1,834 | 0.2% | -26.8% |
| Pittsburgh, PA | $164,009 | 3.7% | $1,157 | 2.5% | -33.2% |
| Portland, OR | $424,129 | 3.9% | $1,676 | 1.4% | -26.9% |
| Charlotte, NC | $245,397 | 6.8% | $1,512 | 1.5% | -15.3% |
| Sacramento, CA | $440,508 | 4.2% | $1,846 | 3.5% | -13.8% |
| San Antonio, TX | $209,475 | 2.6% | $1,362 | 1.4% | -33.0% |
| Orlando, FL | $263,892 | 5.1% | $1,610 | 1.0% | -36.1% |
| Cincinnati, OH | $193,450 | 6.2% | $1,217 | 4.0% | -34.6% |
| Cleveland, OH | $164,554 | 5.4% | $1,137 | 1.3% | -24.4% |
| Kansas City, MO | $211,454 | 5.1% | $1,226 | 2.9% | -31.3% |
| Las Vegas, NV | $296,203 | 1.8% | $1,451 | 1.8% | -32.3% |
| Columbus, OH | $219,688 | 6.1% | $1,325 | 2.6% | -26.8% |
| Indianapolis, IN | $189,034 | 6.5% | $1,244 | 4.4% | -21.7% |
| San Jose, CA | $1,192,683 | 5.0% | $3,149 | -1.2% | -33.6% |
| Austin, TX | $350,361 | 5.0% | $1,613 | 0.2% | -7.9% |
| Virginia Beach, VA | $249,778 | 4.2% | $1,387 | 1.6% | -31.5% |
| Nashville, TN | $287,420 | 5.4% | $1,667 | 3.1% | -12.2% |
| Providence, RI | $327,016 | 4.2% | $1,633 | 4.2% | -24.2% |
| Milwaukee, WI | $215,365 | 6.2% | $1,133 | 2.1% | -33.9% |
| Jacksonville, FL | $237,761 | 4.6% | $1,419 | 2.5% | -24.3% |
| Memphis, TN | $161,799 | 7.5% | $1,343 | 6.0% | -34.8% |
| Oklahoma City, OK | $162,978 | 6.1% | $1,090 | -0.1% | -37.8% |
| Louisville, KY | $186,559 | 5.7% | $1,090 | 2.5% | -26.7% |
| Hartford, CT | $243,200 | 2.1% | $1,421 | 2.7% | -32.0% |
| Richmond, VA | $253,863 | 4.5% | $1,351 | 2.8% | -27.7% |
| New Orleans, LA | $212,213 | 4.8% | $1,451 | 1.6% | -29.0% |
| Buffalo, NY | $178,474 | 3.8% | $1,101 | 3.3% | -27.9% |
| Raleigh, NC | $289,093 | 3.9% | $1,506 | 0.5% | -33.8% |
| Birmingham, AL | $172,916 | 7.6% | $1,185 | 2.5% | -14.1% |
| Salt Lake City, UT | $394,528 | 6.6% | $1,427 | 0.8% | -17.5% |
| *Table ordered by market size |
About Zillow
Zillow, the top real estate website in the U.S., is building an on-demand real estate experience. Whether selling, buying, renting or financing, customers can turn to Zillow’s businesses to find and get into their next home with speed, certainty and ease.
In addition to for-sale and rental listings, Zillow Offers buys and sells homes directly in dozens of markets across the country, allowing sellers control over their timeline. Zillow Home Loans, our affiliate lender, provides our customers with an easy option to get pre-approved and secure financing for their next home purchase.
Millions of people visit Zillow Group sites every month to start their home search, and now they can rely on Zillow to help them finish it — with the same confidence, ease and empowerment they’ve come to expect from real estate’s most trusted brand.
Launched in 2006, Zillow is owned and operated by Zillow Group, Inc. (NASDAQ:Z and ZG) and headquartered in Seattle.
Zillow and Zillow Offers are registered trademarks of Zillow, Inc.
i The Zillow Real Estate Market Reports are a monthly overview of the national and local real estate markets. The reports are compiled by Zillow Real Estate Research. For more information, visit www.zillow.com/research/. The data in Zillow’s Real Estate Market Reports are aggregated from public sources by a number of data providers for 928 metropolitan and micropolitan areas dating back to 1996. Mortgage and home loan data are typically recorded in each county and publicly available through a county recorder’s office. All current monthly data at the national, state, metro, city, ZIP code and neighborhood level can be accessed at www.zillow.com/research/data.
ii Zillow Group Marketplace, Inc. is a licensed mortgage broker, NMLS #1303160.
SOURCE Zillow