Economic Research & Analysis

July 2012 Economic Snapshot

Highlights

Private employment rose by 15,100 in May after an increase of 7,800 jobs in April.
The unemployment rate rose to 9.7 percent in May from 9.5 percent in April.
The Manhattan hotel occupancy rate in May 2012 was 91.3 percent, up from 89.2 percent in May 2011.
The Manhattan Class A office vacancy rate was 8.1 percent in June 2012, while the average asking rent was $69 PSF.
Passengers in NYC area airports totaled 9.4 million in April 2012, up 5.0 percent from April 2011.

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#30 Housing Units and Rents

NYCEDC explores the trends in housing and rent across NYC based on occupancy and vacancy rates.

Employment

  • Private sector jobs in New York City rose by 15,100 in May after an increase of 7,800 in April.
  • In the same period, government jobs in the City fell by 1,800 resulting in a net increase of 13,300 total private and public sector jobs.
  • Since May 2011, private sector employment has risen by 78,900 jobs or 2.4 percent.
  • The City’s unemployment rate rose to 9.7 percent in May from 9.5 percent in April.
  • Between April and May, the number of employed City residents rose by 5,000 and the number of unemployed City residents rose by 6,100.

 

Housing Units and Rents

  • The New York City Housing and Vacancy Survey, conducted every three years by the Census Bureau, provides information about occupied and vacant housing unit types and residential rental rates in New York City.
  • The latest available survey shows that in 2011 there were 3,088,881 occupied housing units in New York City, of which 68.1 percent (2,104,816) were rentals, and 38.6 percent of the rentals were unregulated (market rate). Of the regulated rental units, almost three-fourths (74.3 percent) were rent stabilized, public housing accounted for 14.3 percent, and rent-controlled and other regulated units accounted for 3 and 8.4 percent, respectively.

Occupied Rentals

  • In 2011, almost two-thirds (62.1 percent) of the City’s public housing units were located in Brooklyn or Manhattan. The majority of rent-controlled units were located in Manhattan and approximately one-quarter in Brooklyn.
  • There is wide variation in the type of rental units across boroughs. Market rate units accounted for 72 percent of all rentals in Staten Island, while they made up a little over 20 percent of all rentals in the Bronx.
  • There is also variation in rental vacancy rates across boroughs. The rental vacancy rate is important because it is the primary determinant of rent-control and rent-stabilization policies in the City.1 In 2011, the rental vacancy rate in the City was 3.12 percent. Brooklyn had the lowest rate (2.61 percent) while Staten Island, with the fewest rental units, had the highest rental vacancy rate (6.65 percent).
  • Moreover, the vacant units are not evenly distributed across the boroughs. A majority of the vacant units (51.7 percent) are located in Brooklyn and Queens.

Vacancy Rates

  • The median contract rent for all rental unit types in New York City was $1,100 in 2011.2 Again, this varied widely by borough. Manhattan had the highest median contract rent ($1,500), followed by Queens, Brooklyn, and Staten Island ($1,150, $1,000, and $975, respectively). In the Bronx median contract rent was $933, the lowest of all the boroughs.
  • Median household income for renters in the City was $38,500, which means that renters spent over one-third of their incomes on rent.3 Bronx renters spent the highest share of median household income on rent (44.4 percent), followed by Brooklyn, Staten Island, and Queens renters (34.3, 33.4, 32.5 percent, respectively). For Manhattan renters, the median rent was 31.2 percent of median household income.

1 The City and State rent-regulation laws permit the City to continue rent control and rent stabilization if there is a housing emergency, which is defined as a rental vacancy rate lower than 5%. Low vacancy rates can result in rising rents, which limits the availability of affordable housing.

2 Median contract rent: the rent amount indicated on the lease (even if furnishings, utilities, or services are included).

3 Share of income spent on rent is annual median contract rent divided by median household income.

 

Real Estate and Construction

Manhattan Office Market

  • In June 2012, the Manhattan Class A direct vacancy rate fell to 8.6 percent, while the average rental rate remained stable at $69 PSF.
  • In the same month, the Midtown Class A direct vacancy rate fell to 8.6 percent and the rental rate remained at $69 PSF.
  • The Manhattan Class A sublease vacancy rate rose to 1.9 percent in June from1.8 percent in May.

Source: Cushman & Wakefield

Construction

For the twelve months ending May 2012:

  • Building projects (including new, additions and alterations) that started construction in NYC increased by 9.6 percent and infrastructure (non-building) project starts increased by 1.6 percent from the twelve months ending May 2011.
  • Planned space for building project starts fell by 2.5 percent from the same period in 2011.
  • 2,552 residential building projects with 11,657 units of housing started construction, increases of 13.7 percent and 34.0 percent, respectively over the period.

Source: McGraw Hill Construction

Tourism, Travel, and Transit

Transit Ridership

  • Total ridership on MTA subways, trains and buses in May 2012 was 234.7 million, an increase of 3.7 percent from May 2011.
  • Subway ridership in May 2012 was 148.4 million, an increase of 4.6 percent from May 2011.

Source: Metropolitan Transportation Authority

Air Traffic

  • In April 2012, 9.4 million passengers flew into and out of the region's airports, an increase of 5.0 percent from April 2011.
  • Domestic air carriers accounted for 6.3 million passengers, a 6.6 percent increase from April 2011.
  • 3.2 million passengers traveled with international air carriers in April 2012, a 1.8 percent increase from April 2011.

Source: Port Authority of New York and New Jersey

Broadway Ticket Sales

  • Total Broadway attendance was approximately 1.3 million during the five weeks ending July 1, 2012, up 1.9 percent from the same period last year.
  • Broadway revenue during this period was about $123.5 million, up 11.9 percent from last year.

Source: The Broadway League

Hotel Occupancy

  • In May 2012, the average daily hotel room rate was $290, a 3.8 percent increase from May 2011.
  • Hotel occupancy was 91.3 percent in May 2012, up from 89.2 percent in May 2011.
  • The average daily hotel room rate increased the most in lower-priced hotels (charging between $200 and $250 per night).

Source: PKF Consulting