According to Marcus & Millichap’s 2025 New York Multifamily Investment Forecast Report, the New York City metro area is expected to see a surge in rent growth over the next three years. This can be attributed to a combination of limited supply and strong job growth. The report predicts that average effective rents will reach $3,090 per month.
While there may be a slight decrease in new apartment completions, the overall inventory growth rate of 9.9% is still one of the slowest nationwide and consistent with trends seen over the past eight years. Despite potential increases in vacancy rates for higher-end properties, it is projected that overall vacancy rates will remain below historical averages at 2.1%.
John Horowitz, SVP and Northeast division manager at Marcus & Millichap stated that NYC’s multifamily market has been able to adapt well to economic changes and significant regulatory shifts. However, operating expenses are rising while rent increases are limited for stabilized assets which presents challenges for property owners.
Despite these challenges, there continues to be high demand from investors who have faith in NYC as a long-term investment opportunity. For other types of apartment assets outside of rent-stabilized properties though, record-low vacancy rates combined with rapidly increasing rents make this an ideal time for strategic investments with potential long-term gains.
Horowitz also noted that even amidst all these changes and challenges facing NYC’s multifamily market today; it remains one of the most sought-after markets globally making 2025 an important year for strategic investments.
