Sam Banellis has lived in New York City for about 10 years — six of those years in Brooklyn — and has had a lot of practice apartment hunting in the area.
But she said looking for an apartment in recent weeks was unlike anything she’s experienced before.
“This was definitely the worst it's been,” Banellis, 28, said.
She found that landlords were asking for more documentation than usual such as past years’ tax returns, as opposed to just a W-2. Multiple listings required her to bid over the listing price.
Banellis also noticed that many open houses were operating on limited and narrow timeframes without much flexibility outside of that.
“It definitely just seemed more intense, like brokers knew they didn't have to cater to you,” the Bedford-Stuyvesant resident said.
The rental market has seen steep gains since 2020, when it took an unprecedented hit during the start of the COVID-19 pandemic. In 2021, long lines and bidding wars returned as landlords regained the upper hand in negotiations.
The trend continued into 2022, and current economic conditions such as rising interest rates have only exacerbated the problems, experts say.
The spike in mortgage rates means people who would have normally entered the buying market are remaining in rental units, experts said, putting an even tighter squeeze on the city’s already low inventory of housing units.
“We're essentially making a tight situation even tighter,” said Jonathan Miller, president of real estate appraisal and consulting firm Miller Samuel, which produces a monthly market report in partnership with real estate firm Douglas Elliman.
In June, the average monthly rent for a Manhattan apartment surpassed $5,000 since the firm began producing the monthly reports in 2008. The median rental price also reached a record of $4,050 last month.
But it’s not just Manhattan, or the high end of the market, seeing steep rent hikes. It’s happening across the board, which is atypical, Miller said.
“This is not some sort of shift in the mix, where one segment of the market is punished more than the other,” he said. “We are seeing this uniformly across the market where we're seeing a lot of price growth from the high end down to the startup market. It is literally across the board.”
Banellis, who was looking for an apartment in neighborhoods around north and central Brooklyn, said she had to pay a broker fee for the first time, which she found as a requirement on most if not all of the listings that interested her.
Her current rent, split with a roommate, was $2,600. But noise issues in her building prompted the move.
She said trying to find “quality” listings for that same price was tough so they increased their budget to $3,000.
Last week, they signed a lease for a new apartment for $3,000, $100 above the listed price, plus a $2,000 broker fee.
She called the whole process “demoralizing.”
“It’s just really frustrating to have to be dropping everything like dropping work, or waking up on a Saturday morning to run out and look at an apartment and know that either the pictures weren't going to be the way they seemed in real life or know that even if we liked it, there was a really good chance of not getting it,” she said. “Demoralizing is a good way to describe it.”
Inflation is also putting the burden on renters' pocketbooks, experts said. As prices rise for fuel and labor, landlords will likely shift that cost to renters.
“You're getting pinched because your landlord's costs are going up and if you're not rent-stabilized, they're passing them along to you by raising your rent,” said Comptroller Brad Lander, whose office released a report last week on the city’s economic and fiscal outlook.
The study cited numbers by StreetEasy that showed median asking rents surged by 29% over the past 12 months.
Lander called this issue a “housing crisis” and said the city needs to take a multipronged approach to battle this problem.
One strategy he suggested was for the city to make it easier to increase the housing supply by providing subsidies for development across the marketplace.
But even that solution will take some time, he said.
“That's going to take several years before — at best — it could have any real impact in easing market prices,” Lander said.
He also pointed to his efforts to get Albany to pass policies such as "Good Cause Eviction,” which would protect tenants from excessive rent hikes and guarantee lease renewals or the right to remain to those in good standing. It failed to pass in the last legislative session.
“That won't help ease the rental market overall, but it'll at least help prevent some evictions,” he said.