As rents in New York reach new highs, 85% of residents want to buy elsewhere – they think so

Rising rents in New York City have prompted most residents to look for homeownership opportunities in other states. New data from Realtor.com shows that 85% of online home hunters in Manhattan are looking beyond state lines.

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The exodus mentality arises as Manhattan’s average monthly rent reaches $4,415. Although this represents a slight decrease of 1.1% compared to the previous year, rent increases in the outer suburbs have led to an increase in citywide rents. According to the report, the Bronx leads the way with an 8.6% increase to $3,164, followed by Queens with a 7% increase to $3,343, while Brooklyn is up 0.1% to $3,683 increases.

The city’s rental market bucks the national trend, where the 50 largest markets have seen rent declines for 15 consecutive months. The median asking rent in New York rose 1.7% year-over-year to $3,374 in October 2024, a 13.1% increase from pre-pandemic levels.

“Buyers who have the flexibility to move away and keep their housing budgets at Manhattan rental levels can accelerate the path to homeownership,” Jiayi Xu, economic analyst at Realtor.com, was quoted as saying in the report. A Manhattan renter’s typical income requirement of $176,604 could support home purchases in other markets.

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The analysis shows that Manhattan renters who use their current monthly housing budget of $4,415 for mortgage payments could afford homes in popular relocation destinations between $600,000 and $750,000. The calculations assume a down payment of 20% and a current mortgage interest rate of 6.43%.

Bridgeport, Connecticut, was a particularly attractive option. Renters in Manhattan could afford homes priced at $646,150 – nearly double the area’s average listing price of $322,500. The city offers both beach access and rail connections to New York, the real estate agent said.

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Similarly, West Palm Beach, Florida, offers opportunities with an average listing price of $399,900, well within previous Manhattan renters’ budget of $655,500. Myrtle Beach, South Carolina offers even greater buying power with a purchase potential of $752,000 with an average asking price of $299,900.

Closer to home, New Jersey’s Long Branch is attracting interest despite its median listing price of $1.22 million, as Manhattan rental budgets could still secure $624,000 worth of properties. Rounding out popular destinations, Pittsburgh offers broad market access with a median listing price of $255,000, well below potential buyers’ budget of $599,800.

The trend represents a shift in housing strategies as New Yorkers increasingly view their high rent payments as potential mortgage investments in more affordable markets.

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