Editor's note: Below you'll find the week 13 release of the NYC Recovery Index, originally published Nov. 3, 2020. Visit the NYC Recovery index homepage for the latest data.
The latest reading of the New York City Recovery Index out of a possible score of 100.
New York City’s economic recovery crept slightly higher in the past week as real estate sales continued to show strength, along with more restaurant activity and better unemployment data.
But a rise in COVID-19 hospitalizations since September tampered the gains. As the pandemic nears its eighth month, New York City’s economic recovery stands at 51 out of a total score of 100, according to the New York City Recovery tracker, a joint project between Investopedia and NY1. The index jumped 3.5 points from the prior week.
COVID-19 Hospitalizations Hold Steady
COVID-19 hospitalizations remained on par with the prior week at an average of 50 hospitalizations per day. However, due to an increase in cases in parts of Queens and Brooklyn in September, October saw double the number of average weekly hospitalizations than we saw in September. The good news, however, is that cases have yet to spike following the partial return of public school students in mid-September.
While New York City has the second-highest unemployment rate of any major city in the country next to Los Angeles, initial weekly claims for unemployment are finally starting to decline. During the week of Oct. 24, 28,451 New Yorkers filed for first-time unemployment claims, which is 3,520 fewer than the previous week. This was the second straight week of significant decreases, but initial unemployment claims are still five-times higher than they were during the same period in 2019.
Pending Home Sales Rise
Pending homes sales, or homes in contract, continue to be a bright spot in the city’s economy. Pending sales were up 27% from the same period last year as 531 homes went into contract, according to data from StreetEasy. Brooklyn and Manhattan continue to lead all boroughs in sales, and were up 34% and 31%, respectively, compared to last year.
Average Rental Prices Fall to Decade-Low
While we have yet to include apartment rental prices in the index, the declines in prices and the rise in inventory tell a very different tale about the health of New York City’s housing market. According to StreetEasy, the median asking rent for a Manhattan apartment in the third quarter fell to $2,990, the first time it has dropped below $3,000 in nine years.
Furthermore, StreetEasy data shows that the share of discounted rental listings rose to a record high of 44.7% in the third quarter, up 22.7% from the same period last year. Rental inventory in Manhattan increased by 69.8% from a year ago, with 72,267 listings, nearly 30,000 more than last year.
Commercial Real Estate Woes
New York City may be facing a commercial real estate crisis if it is not already in one. According to Colliers International, year-over-year leasing volume was 54.6% lower than it was in Oct. 2019. Manhattan’s monthly availability rate increased for the fifth consecutive month to 12.9%, the highest rate since 2004. The average asking rent for commercial property in Manhattan fell 1.2% from September to October to $76.20 per square foot.
Subway Ridership Shows Slight Increase
Subway ridership inched higher in the past week as 1.6 million riders traveled underground, up from 1.5 million the prior week. But that is still down 68% from a year ago. The MTA is seeking a federal bailout of $12 billion to keep the agency afloat. A report from the NYU Rudin Center for Transportation says without a federal bailout, 450,000 jobs could be lost along with $50 billion in lost earnings in the region if the MTA is forced to make cuts to commuter services.
Restaurant Reservations Increase Slightly
The colder weather did not keep New Yorkers from continuing to dine out, albeit at a much lower rate than a year ago. According to data from OpenTable, restaurant reservations increased 3% from the prior week, but are still down 75% from a year ago. More than 1,000 New York City restaurants have closed since the pandemic, according to Eater.com, and last week saw a few more notable closures, including Il Triangolo in Corona, Queens and Champion Coffee in Greenpoint.