(Bloomberg) -- Manhattan apartment rents fell last month as landlords’ pricing power was hurt by a wave of new listings and tenants who shopped around for better deals.
The median monthly rent was $3,396, down 1.2 percent from September 2015, according to a report Thursday by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. It was only the second year-over-year decline since February 2014. Rents also fell this past March.
A surge of construction is adding thousands of new apartments in Manhattan, slowing momentum for landlords, who had pushed up rents as much as 20 percent since the end of the recession in June 2009. Price-weary renters now have the power to push back and search for more attractive leases, and landlords are working harder to offer them.
“It’s going to take a while to work itself out,” Jonathan Miller, president of Miller Samuel, said in an interview. “The market does not appear to be resuming an upward pattern anytime soon.”
The inventory of available listings at the end of September climbed 35 percent from a year earlier to 7,392, Miller Samuel and Douglas Elliman said. It was the biggest increase for the month since the firms began tracking the measure in 2009.
Landlords offered discounts averaging 2.8 percent in order to reach a deal. Sweeteners, such as a month’s free rent, were included in 15 percent of all new leases, the most for a September in data going back to 2010. In the year-earlier period, only 8.7 percent of deals came with such concessions.
Newly signed leases jumped 51 percent, a sign that tenants are finding better deals by moving out rather than renewing their agreements.
“I don’t think anybody’s saying that rents are cheap now, it’s just that there’s no growth,” Miller said. “And I and don’t see a whole lot of change in that narrative going forward.”
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