LIC rental market declines during last quarter of 2017
During 2017, the prices of rentals in LIC saw a decline that came dangerously close to double digits, mainly because of how saturated the market has become. A report released by Modern Spaces stated this information, specifying that the average rent of Long Island City saw a decline of 9% on the last quarter of 2017 (compared to the last quarter of 2016).Nevertheless, the CEO of Modern Spaces, Eric Benaim, predicted this weakening back in 2016.
The sub market that took the hardest blow was Court Square: the average of that rea dropped 23% (comparing the two quarters previously mentioned). To compare, Hunters Point saw a decline of only 8%, while Queens Plaza was one of the areas to experience an increase. In this particular case, of 5%.
The market has steadily been becoming softer, so the rental concessions developers are doing are directly affecting rent average. Some landlords offer three months of free rent when signing leases of 24 months, according to data presented on the same report by Modern Spaces.
Thousands of units are available for rent or purchase and many more are scheduled to become available soon, so landlords and developers need to incentivise individuals for them to choose their projects. In 2017 alone, approximately 2,200 units were introduced to the market. In Court Square alone a building with 974 units was inaugurated (the Hayden). Because of this, almost half of the leases that were signed last year are based in this area, causing a 3% drop in the rent prices of Court Square one bedroom apartments, while the rent for two-bedroom units dropped 5%. Nevertheless, what occurred to three-bedroom units was astonishing: these units in the same area dropped a whopping 26% in the same periods.
As far as studios apartment go, the average price increased almost 6%, but they decreased in some specific areas like Hunters Point, where the decline was of 16%. The two-bedroom apartments of this area dropped significantly too: 14%.
In the Queens Plaza district rental prices increased. One bedrooms increased by 5%, which is interesting since many building were inaugurated in this area during the past year (Tower 28 and Packard Square West to name a couple). [LIC Post]