Brooklyn apartment rents, vacancies showing signs of stabilising, says Marcus & Millichap

KUALA LUMPUR: Rent prices in the Brooklyn apartment market are showing signs of stability following swings in rents and vacancies underpinned by job losses, according to a report.

However, it is unlikely that the market has hit bottom yet, said real estate investment services firm Marcus & Millichap in their 4Q apartment research report.

This follows the softer round of job cuts that appear to be mirrored in apartment fundamentals, where rents and vacancies were affected by unemployment rates, according to the report.

Nonetheless, the firm found that 103,800 jobs will be slashed in 2009, which is a 2.8% decline in employment. “Last year, 27,200 workers were let go,” said the report.

Given the increasing joblessness, vacancy in large, free-market buildings may increase by 110 basis points to 2.9% in 2009 due to weakened renter demand. The rate improved 140 basis points last year.

“Asking rents are projected retreat 3% to US$1,397 (RM4,751) per month this year, following a 4.8% gain in 2008,” said the report.

The firm also said that construction output will be limited from 2009 onwards as multi-family permit issuance dropped by 90% year-on-year.