Manhattan Apartment Rents Fall as Unemployment Rises (Update2) By Oshrat Carmiel April 13 (Bloomberg) -- Manhattan apartment rents fell as much as 5.9 percent in March from a year earlier as a record jump in unemployment damped demand, Citi-Habitats Inc. said. Average rents declined for apartments of all sizes and the vacancy rate topped 2 percent for the fifth straight month, the New York-based property broker said today in an e-mailed statement. Demand slumped after New York Cityâs unemployment rate climbed to 8.1 percent in February, the highest level since October 2003 and the biggest month-to-month increase on record. City Comptroller William Thompson predicted in March that New York City would lose 250,000 jobs before the recession ends. âThere are people who are unemployed, and people not willing to spend the type of money they were willing to spend before and they need to make tough decisions,â said Gary Malin, president of Citi-Habitats. Rents for studio apartments dropped 2.1 percent to an average of $1,812, while those for one-bedroom units fell 5.9 percent to $2,595. The cost of renting two-bedroom homes declined 2.2 percent to $3,631 and three-bedrooms fell 1.6 percent to an average of $4,670. Concessions The average declines for March donât reflect concessions offered by landlords, such as a free monthâs rent, that lower the overall cost to tenants, Malin said. âThere is a greater degree of price decline than those numbers show,â he said. The average rent for two-bedroom apartments on Manhattanâs Upper West Side fell 8.6 percent in March to $3,580, while one- bedrooms dropped 2.4 percent to $2,393. The price of studios in the neighborhood climbed 6.4 percent to $1,966, according to the report. At Trump Place at 220 Riverside Blvd., 25 apartments are now available for rent, 13 for reduced prices, according to the property listing service Streeteasy.com. A 700 square-foot one-bedroom in the building is listed for $3,800 a month, 10 percent less than its November 2008 price. The furnished condo is in a Trump property along the West Side Highway that includes a health club and a swimming pool, according to Streeteasy.com. Vacancy rates of Manhattan apartments reached 3.8 percent in October 2002, according to Citi-Habitats. Marchâs vacancy rate of 2.37 percent was last seen in Manhattan in the six-month period between November 2002 and April 2003, when vacancies averaged 2.35 percent. The broker has been tracking the market since 2002. U.S. Vacancies Manhattanâs East Village had the highest vacancy rates in March with 3.24 percent of its rental units available, Citi- Habitats said. Soho and TriBeCa, both in Lower Manhattan, had the lowest vacancy rate: 1.84 percent. Across the U.S., apartment vacancies climbed to 7.2 percent in the first quarter from 6 percent a year earlier and 6.6 percent in the fourth quarter, Reis Inc., a New York-based research firm, said April 7. Vacancies were at the same level as the first quarter of 2004, matching the highest since Reis began conducting its survey in 1999. Rents across the country fell 1.1 percent in the first quarter from the previous three months to $984 on average. They were up 0.1 percent from a year earlier, Reis said.