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Skyrocking rents sending apartment hunters to boroughs

…“The drivers of rental increases in Brooklyn are the same drivers in Manhattan, and virtually every housing market in the country,” said Miller. “It’s tight credit. You have a lot of people that don’t qualify for a mortgage or they can’t find something to buy because inventory is so tight on the sales side, so they’re tipped back into the rental market, which affects the shortage of availability.”

Ten years ago, Brooklyn was the “key beneficiary” to Manhattan being too expensive, but now it’s become a destination, with buyers and renters choosing Brooklyn over Manhattan, said Miller….

…“It’s no surprise because over the last year price indicators have been trending higher,” said Miller.

Inventory in Brooklyn fell to a 5-year low, dropping 18.5% since the same time last year, making it the lowest second quarter since 2008.“There just hasn’t been enough supply entering the market,” said Miller….

…“In the boroughs and in many markets across the country, supply is tight because a large swath of people that have a mortgage have either low or negative equity,” said Miller. “In the U.S., 44% of people that own a home with a mortgage have either low or negative equity.”

Another factor contributing to the increasing rental prices is the improving city economy and increasing employment. And Miller doesn’t see the trends changing anytime soon….

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