El precio de los alquileres en Nueva York está a la altura de sus rascacielos

The price of rents in New York is at the height of its skyscrapers

When in mid-May the owner of the house shared in Brooklyn by the Spanish Paula Sevilla and two companions for three years announced that they had to leave on June 30, they never imagined the «nightmare» that they would live to find a new abode.

After two months of searchabout thirty visits and a lot of stress, they found an apartment for $3,000, with two rooms, just for two of them.

After many goings and comingsthey could have stayed in the old one, not far from the new one, but paying 800 dollars more, 4,800 a month.

In the second quarter of 2022 alone, rents in New York rose 20.4%, according to the real estate portal StreetEasy.com.

And the lines of applicants are much longer than they were a few months ago.

“On one occasion we lost a apartment because we sent the application 4 minutes late,” this 26-year-old exclaims to AFP with some disbelief.

Sometimes, it is not enough to arrive first or even offer more money than the owners ask for in many cases large companies or investment funds, particularly in Manhattan in order to sign a lease.

The requirements to rent are draconian: earn an annual salary 40 times the monthly rent, have an unblemished credit history, submit the last two tax returns and bank statements.

Read more: Housing rental prices rise 25%; report 80% drop in House sale

With a salary of 75,000 dollars a year, “the same as the average for a family in this city,” he says, Seville alone would not have been able to rent his new apartment.

To this is added, often, having to pay the real estate agent a commission of 15% of the annual rental price.

“Too many clients and not enough apartment”, summarizes to AFP, overwhelmed, the real estate agent Miguel Urbina, the current situation of the New York market that suffers the consequences of the covid-19.

Much of the 336,000 people who left the city during the worst of the pandemic are back.

Likewise, the arrival of new inhabitants attracted by the cultural, gastronomic and social life of New York, as well as the quality of the schools or the facility of technology companies that offer good salaries and housing aid also contribute to tightening a market characterized by a chronic housing shortage, explains Gea Elika, owner of the Elika Real Estate agency, to AFP.

Rental contracts signed in 2020 and 2021 that offered generous price reductions are being revised upwards, expelling a third of the tenants (34%) who can’t handle the uploads, according to StreetEasy.

Likewise, a panel appointed by the mayor of New York authorized in June a 3.25% increase for one-year contracts and 5% for two years for one million rent-controlled apartments, often occupied by families with less means. The biggest rise in almost a decade.

“Heavy burden on families”

In Manhattan, families spend 55% of their income on living place60% in Brooklyn and 43% in Queens, according to a report by StreetEasy, whose author, Kenny Lee, notes that rent “is becoming a heavy financial burden” for families.

The average rental of a apartment a room in Manhattan costs $5,000, Elika recalls. In the city of contrasts, some agencies offer rentals of up to 140,000 dollars per month on 5th Avenue, in front of Central Park.

High prices make middle-class families or young graduates like Paula Seville seek housing in neighborhoods previously occupied by Latino or African-American immigrants, in an unstoppable process of gentrification.

“No one foresaw what is happening,” says Elika, who acknowledges that “there has always been a housing shortage but now the problem has been magnified.”

According to a report by the Washington-based research group Up For Growth, 340,000 homes were needed in the Washington metropolitan area in 2019. New York.

The rise in interest rates to combat soaring inflation threatens to aggravate the crisis as aspiring buyers are now choosing to rent, in a market that is already “difficult due to historically low supply,” warns Kenny Lee .

Restrictions dating back to 1961 to limit the size of buildings in some areas and prevent new construction in many neighbourhoods, the cost of construction, the scarcity of social housing and the inability of the condition and local politicians to seek viable solutions to this increasingly pressing problem explain to a large extent the current crisis, particularly in Manhattan, despite the boom in skyscrapers that compete in height built in recent years, although many destined for luxury housing or business purposes.

On both sides of the East and Hudson rivers, both in brooklyn and Queens as in New Jersey, cranes and high-rise developments proliferate in the landscape, but the agents consulted do not expect prices to drop in the short term.

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