New York’s multifamily market remained one of the tightest and most resilient in the U.S. through Q3 2025, characterized by low vacancy and steady rent growth amid a slowdown in new supply. The vacancy rate held at 3.4%, far below the national average, supported by strong absorption of 9,100 units and sustained renter demand driven by high-paying jobs and prohibitively expensive homeownership costs. On the supply side, the pipeline is at one of its lowest totals since 2021. Rents continued to rise modestly, with asking rents averaging $3,400 per unit, up 2.5% year-over-year, as demand remained strongest in high-end submarkets like Midtown West and Long Island City. Investment activity also showed solid momentum, underscoring investor confidence in the market’s long-term fundamentals. However, signs of “renter fatigue” emerged, with rent growth flattening late in the quarter and concessions rising in some newly delivered properties.

 

Overall, New York’s multifamily sector continues to outperform, supported by persistent demand, limited supply growth, and one of the lowest vacancy rates in the nation.

 

Key Findings

• Out of New York’s 1.59 million market-rate units, only 3.4% are vacant, which is far below the national average of 8.3%.
• Construction activity has come to a sharp halt, with just 41.9K units under construction (down from a recent 73K high) and starts are down 38% year-over-year.
• Rents increased 2.5% over the past year, five times the national rate, reaching an average of $3.4K/month. However, growth flattened in Q3 2025 as affordability concerns and “sticker shock” led more landlords to offer concessions.

 

New York Multifamily Supply & Demand Dynamics

Source: CoStar Group, Inc.

 

New York Demographics

Source: CoStar Group, Inc.

• Unemployment Rate: 4.6%
• Current Population: 14,859,622
• Households: 5,724,419
• Median Household Income: $90,027

 

New York’s economy remains one of the most dynamic and resilient in the world, anchored by its diverse industries, global influence, and renewed population growth. With more than 20 million residents and a GDP exceeding $2 trillion, the metro area thrives on strengths in finance, technology, healthcare, and the creative sectors. Major employers such as JPMorgan Chase, Google, and Meta continue to expand, supported by record venture capital investment and a surge in AI-related growth. Population gains in 2023 and 2024, coupled with rising tourism, 64 million visitors last year, underscore the city’s post-pandemic rebound. However, housing affordability remains a key challenge, as strong demand continues to outpace supply.

 

New York helps sustain a GDP above $2 trillion, making it the largest metro economy in the world.

Source: CoStar Group, Inc.

 

Population, Labor Force, & Income Growth

Source: CoStar Group, Inc.

 

 New York Multifamily Construction

Construction activity slowed sharply in Q3 2025, reinforcing New York’s reputation as a supply-constrained market. The 41,900 units under construction marks a 39% decline in the city and 34% drop in nearby suburbs, reflecting weaker developer activity amid high costs and regulatory uncertainty. While 13,000 units delivered during the quarter and 28,000 year-to-date (up 19% annually), supply growth is expected to slow as the pipeline thins. New legislation offering limited tax incentives and zoning reforms may spur modest recovery, however most new projects are shifting to transit-oriented suburban areas like Bergen, Middlesex, and Westchester counties. Despite these pockets of activity, the metro’s overall construction pace remains modest relative to its size.

 

Units Construction Starts

Source: CoStar Group, Inc.

 

Units Under Construction

Source: CoStar Group, Inc.

 

 New York Multifamily Sales

Investment activity remained strong in Q3 2025, with $3.7 billion in sales volume and an average price per unit of $384,000, reflecting continued investor confidence despite lingering economic headwinds. Transaction activity has increased each quarter in 2025, aided by recent interest rate cuts and stabilization in financing conditions. Institutional buyers remain focused on newer Class A properties, which accounted for roughly 85% of the top sales this year, including major transactions like Verdant Fort Greene and The Hub in Downtown Brooklyn. Investment has also extended into suburban submarkets such as Englewood and Jersey City, where modern, transit-accessible developments continue to attract capital. While underwriting challenges persist for older, rent-stabilized buildings due to maintenance costs and rent cap restrictions, the overall investment landscape remains active and resilient.

 

New York Multifamily Sales Volume

Source: CoStar Group, Inc.

 

By the Numbers

Q3 2025 | Source: CoStar Group, Inc.

• Sales Volume: $3.7B
• Price Per Unit: $384K
• Cap Rate: 5.4%
• Vacancy Rate: 3.4%
• Rent Growth: 2.5%
• Asking Rent Per Unit: $3.4K
• Under Construction: 41.9K units
• Delivered: 13K units
• Absorbed: 9.1K units