REAL ESTATE: Manhattan Rent Hikes are Slowing

A Bloomberg article published on January 10th, 2013, suggests that Manhattan rent increases have slowed for the third consecutive month in December.  "The median monthly rent rose to $3,150, up 0.8 percent from a year earlier," however, rents are not on "frenzied upward trajectory anymore".  There are multiple factors affecting the slowdown.  Tenants have pushed back against landlord rent increases by moving out.  The industry is also shifting driven by record low mortgage rates and "rents that have climbed to within 4 percent of their 2006 peak" have pushed some tenants into the sales market.  In the fourth quarter of 2012, sales of Manhattan apartments surged 25%, this is the highest for the period since at least 1987.  Given the level of the current 30 year mortgage rate, which in November was 3.31%, this is no surprise as people are starting to take advantage.