KEY POINTS:
Manhattan apartment rents rose an average 10.4 per cent last year, says a broker's report.
The city's most expensive area for a studio, two-bedroom or three-bedroom apartment was Soho-TriBeCa, south of Houston Street, New York broker Citi Habitats found.
Studios cost an average US$2228 ($3000) a month, two-bedrooms cost US$4750 and three bedrooms went for US$6971. One bedrooms were most expensive at US$3035 in the West Village, where low-rise brownstones and townhouses dominate.
Rents have gained as would-be buyers in New York, the most expensive urban real estate market in the US, wait to see if the price of co-ops and condominiums fall.
The low vacancy rate will spur the development of rental properties, said Gary Malin, Citi Habitats' chief operating officer.
"The incredible demand for rental units makes the option of a mix of rental and sales units within a development project or the possibility of an all-rental development a more feasible option," he said.
Real estate research firm Reis said the vacancy rate for apartments across the US rose to 6 per cent in the first quarter, the highest in about two years.
The average price of an apartment in the US was US$972 at the end of 2006, 3.2 per cent higher than a year earlier, the research firm MPF YieldStar said.
Midtown West, a section of the city where developers are building luxury high rises, led the survey with a 27 per cent increase in the cost of three-bedroom apartments, which rented for an average of US$5283.
The average monthly rent in the western US rose 4.2 per cent in the first quarter from a year earlier to US$964, gaining in all but one of the 29 metropolitan areas tracked by research company RealFacts.
- BLOOMBERG
