Jan. 18, 2018 By Nathaly Pesantez
Long Island City rental prices saw a near double-digit decline in 2017 as new units flooded the market, according to a report.
The report, released by Modern Spaces, revealed that the average rent paid across Long Island City fell 9 percent from 4Q2016 to 4Q2017.
Court Square was the sub market hit hardest, with the average down a whopping 23 percent from 4Q2016 to 4Q2017, while units in Hunters Point fell an average of about 8 percent over the same period.
The Queens Plaza area, however, saw a 5 percent uptick, according to Modern Spaces data.
The market’s softening was evident by the rental concessions now being offered. Some buildings are offering three months of free rent on 24-month leases, according to the Modern Spaces.
The report noted that a “deluge of rental units were brought to market” in 2017 and approximately 2,200 new units came online in the fourth quarter alone.
“With thousands of units remaining in the pipeline and set to come online in the near future, this trend appears to be just beginning,” reads the report.
The overall weakening of the rental market was anticipated. Eric Benaim, CEO of Modern Spaces, predicted it in 2016.
In Court Square several large rental buildings came to market last year, such as the 974-unit Hayden, along with the Forge’s 272 luxury units.
Nearly half of the new leases signed last year (47 percent) were in buildings in the Court Square area, according to the report.
The rent paid for a one bedroom apartment in Court Square dropped nearly 3 percent, from $3,074 to $2,983, year-over-year. Two-bedroom units fell 5 percent over the same period, to $3,988.
The amount paid for a three bedroom saw the steepest decline among rentals in Court Square, down a whopping 26 percent year-over-year, to $5,632.
Average studio prices, however, increased by nearly 6 percent, to $2,408, year-over-year.
In Hunters Point, studios led the downward trend, down nearly 16 percent, from $2,651 in 4Q2016 to $2,234 in 4Q2017. Two-bedroom units trailed closely behind, with average prices dropping 14 percent to $3,956.
The Queens Plaza district–where several buildings, including Tower 28, Packard Square West, and 1 QPS came online in 2017–saw an uptick in average rental prices. The price paid for a one bedroom rose 5 percent, to $2,755 for Q42017, compared to the same quarter in 2016.
Click here for Modern Spaces reports.