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By: Don Driggers
The New York Post recently revealed that, as interest rates remain high to combat languishing inflation, warding off potential home buyers, the rental market has been very competitive.
And while New York City’s Manhattan and Brooklyn boroughs have seen the biggest leaps in competitiveness, neighboring North Jersey is now considered the most aggressive market for renters in the nation, according to a new study.
Data from RentCafe’s newest Rental Competitively Report shows that North New Jersey — which makes up Bergen, Essex, Hudson and Passaic counties in the city suburbs — earned the top spot for rental demand, according to The New York Post.
The study found that those North Jersey areas — which comprise Jersey City, Hoboken, East Orange and Hackensack — are twice as competitive as Manhattan due to a drastic housing shortage.
Specifically, an influx of renters is pushing occupancy close to 97%.
The occupancy rate combined with a record 72% of renters choosing to renew their leases — and, on average, 12 people competing for one apartment — led to a Rental Competitivity Index rate (RCI) of 67 at the start of 2023. To compare, the national RCI is 60.
Meanwhile, Manhattan had almost two-thirds of renters renewing their leases (64%) and the occupancy rate increased by 0.4% year-over-year to a strong 95%. On average, this led to six renters competing for one available unit.
Despite Manhattan seeing the fourth biggest increase in competitivity year-over-year, gaining 30 competitive points, it was not enough to make it RentCafe’s top 20 list of the most competitive markets for the year.
Brooklyn, however, ranked number 14. The borough gained 14 points in competitivity.
Housing in Brooklyn cannot keep up with the demand, the study notes. Newly opened apartments added just 0.3% to what was available on the market — and it wasn’t enough to lower the 96% occupancy rate.
On top of that, more than two-thirds of Brooklynites renewed their leases (65%), with an average of nine renters applying for the same place.
Brooklyn, however, ranked number 14. The borough gained 14 points in competitivity.
Housing in Brooklyn cannot keep up with the demand, the study notes. Newly opened apartments added just 0.3% to what was available on the market — and it wasn’t enough to lower the 96% occupancy rate.
On top of that, more than two-thirds of Brooklynites renewed their leases (65%), with an average of nine renters applying for the same place.
On the negative side, the banking sector’s problems could cause further damage to home prices in activity on the West Coast – where several cities’ markets were already considered “overheated” following a pandemic-era surge.
Rents increased between 20% and 40% in 14 New Jersey’s counties since the start of the pandemic, new data published by Zillow shows.
The typical rent paid by a New Jersey tenant increased by at least 30% in Atlantic, Ocean, Camden, Hunterdon and Gloucester counties between February 2020 and December 2022, an analysis of the data shows.
