N
ew York’s rental market is tightening faster than ever, and the numbers speak for themselves. In Manhattan, the average rent for November 2025 hit $5,686—an increase of 13 % from last year’s $5,047. The median rent climbed to $4,750, also up 13.1 % from $4,200 a year earlier. The cost per square foot edged toward the $100 mark, up from $86 last November. These figures confirm that affordability is slipping beyond reach for many.
The sharp rise is largely tied to the Fairness in Apartment Rental Expenses Act (FARE), which took full effect in June. The law prohibits landlords and listing agents from charging tenants a broker fee if the tenant did not hire the broker. In practice, the fee has been shifted to landlords and folded into the rent. Keyan Sanai, a top Douglas Elliman rental agent, notes that the FARE Act caused rents to jump almost 8 % overnight, leaving a net increase of about 5 % when adjusted for the fee shift.
Sanai describes a cascading repricing across the market. A Chelsea studio that previously cost $3,000 plus a one‑month broker fee rose to $3,400 after the fee was removed. A luxury unit that had been $3,600 without a fee jumped to $4,200, creating a new price gap. This pattern is now common in both luxury and non‑luxury buildings.
Supply constraints compound the problem. New housing units are scarce, especially in prime neighborhoods like West Village, Tribeca, and West Chelsea. When supply is limited, prices rise—a classic supply‑and‑demand effect. The return‑to‑office push adds pressure. Companies such as Instagram are now back for five days a week, prompting workers who had moved upstate for occasional commutes to seek proximity to Manhattan again.
Renters are increasingly choosing flexibility over buying, especially as mortgage rates remain high. Corcoran agent Taylor Durland observes that many are renting because it feels less of a commitment amid economic uncertainty. Even well‑paid newcomers must adjust expectations. Durland recently helped Sonam Singh, a tech professional relocating from London, who had hoped for a two‑bedroom downtown apartment. The market forced her to settle for a one‑bedroom with amenities in the Flatiron area, paying $6,500–$7,000 per month—a price that would buy a two‑to‑three‑bedroom house in an affluent London neighborhood.
The high cost of living in New York also brings hidden expenses. Singh noted that budgeting for a move from another country is fraught with unexpected costs beyond rent and utilities. These surprises can prompt renters to seek ways to cut expenses elsewhere.
Appraiser Jonathan Miller, who authors the Elliman report, attributes much of the affordability crunch to a frozen sales market. High mortgage rates keep potential buyers in the rental pool, further tightening supply. Miller explains that the affordability issues that emerged after COVID are largely driven by interest rates, not just rent. Those who intended to buy remain renters, sustaining demand and keeping rents high.
Even if rents were to fall, the city’s magnetic pull would likely keep demand steady. Durland believes that New York’s allure remains strong, ensuring that the market will continue to be competitive. The combination of the FARE Act, limited supply, high mortgage rates, and a return to office life creates a perfect storm that pushes rents to record levels and keeps affordability out of reach for many.
