Photo-Illustration: Curbed; Photos: Getty
Nat Serrano, an app developer, lives in an Upper West Side one-bedroom with his wife and three young kids. Their current arrangement — a five-way share of an Alaskan king — can only last them so long. “I cannot sleep with my kids forever,” he says. They’ve been searching for a three-bedroom in the neighborhood, but everything they’ve seen in their price range is awkwardly carved up and about the same size as their current 750-square-foot apartment. “We can pay up to $5,000 a month, but there’s nothing,” he tells me. “It’s impossible.” Three years in, a three-bedroom in a fourth-floor walk-up on 82nd and Amsterdam that they turned down early in their search haunts him: “We should have taken it.”
In New York City, true threes are rare and coveted. They’ve always been elusive, but never have the pickings been so slim — or expensive — brokers say. Most of what’s out there seems to be a one- or two-bedroom chopped up to accommodate a third (the new kitchen unit awkwardly tacked onto the wall of an already small living room is a dead giveaway) or luxury new builds that are priced for Goldman executives. Anyone with a halfway decent three-bed — that is, an apartment that is actually, properly large, not just excessively partitioned — isn’t giving it up. That leaves families like the Serranos in two-bed purgatory.
Several trends have brought us here. In terms of demand, the actual three-bedroom that offers more space and not just more rooms sits at a very particular nexus in the city’s real-estate hierarchy: highly sought after by families in general, but a white whale for affluent-ish parents who can’t afford an $9,500 Park Slope duplex or the interest on the $2 million fixer-upper uptown. “All the people who’d otherwise like to buy, they’re staying put,” says Noble Black, an associate broker at Douglas Elliman. The old pressure-release valve of the family exodus to the suburbs has also broken down: An extremely tight suburban-housing market means that many who’d like to leave are staying in the city, at least for now. Your neighbor putting their dream of moving to New Rochelle on hold is part of the reason you can’t take over their lease and why the couple down the hall expecting their first kid can’t take over your two-bedroom. “All those areas of the housing market trickle into each other,” says Black. “It’s a sticking point.”
Three-bedrooms have long been hard to find, says Julie Rhinehart, of Corcoran, but in the past Brooklyn buyers would go from a two-bedroom to a townhouse. Now townhouses trade for $2.5 million and up (and that’s a gut renovation in most neighborhoods), and a nicely renovated place in Park Slope goes for $7 million or more. One of Rhinehart’s clients got fed up with losing out in six- and seven-person bidding wars for three-bedrooms and thought they’d solved their problem by finding a $1.7 million townhouse in Prospect Heights that needed a total gut reno. “They were so excited. They were like, ‘We can get this house,’” she says. The house got 26 offers in one week.
And really, there were never many bigger apartments out there to begin with. “A three-bedroom is super rare, super rare,” says Lisa James, a Corcoran agent who works in South and Central Brooklyn. Many of the older rent-stabilized three-bedrooms haven’t turned over in decades — life circumstances like marriage or kids push residents out of studios and one-bedrooms, but people hang on to threes — and those that did in years past were often broken up by landlords into smaller, separate units. (When it comes to stabilized apartments, there’s also zero incentive for someone paying $1,000 a month to downsize to a more expensive unit.)
Three-bedroom rentals only account for about 9.7 percent of new Manhattan leases, according to Jonathan Miller, of Miller Samuel, up from around 4.5 percent in the late 1990s. But leasing only reflects what’s in circulation, not what exists, and the assumption is a lot of the better units, like the covetable stabilized three-beds, aren’t changing hands much. A decent amount of that growth, at least given what does hit the market, also seems to be coming from faux three-beds. It’s not all cheap remodels — new construction, especially when it’s a rental going for a somewhat attainable price, is often stingy with the square footage. (“A lot of them don’t feel like three bedrooms,” a broker tells me.) And then, of course, there’s the ultra high-end new construction — a press release that made the rounds earlier this year trumpeted $25,000-a-month three-beds.
The lack of three-beds is also at least partially an affordable-housing issue — as high rents continue to make living alone prohibitively expensive for many, single people opt for shares, and together, with three incomes, are able to pay more than a lot of families can manage. Affordable-housing advocates, meanwhile, frequently complain that housing lotteries mostly offer studios and one-beds, which are cheaper for developers to build, rather than larger apartments (and the larger apartments that do get built are almost always two-beds, never threes). (A Gothamist analysis found that 70 percent of the affordable apartments built under Mayor Eric Adams were studios and one-beds.)
So the market-rate three-bed is out of reach and the affordable one essentially nonexistent. In Manhattan, the average three-bedroom rental price was $8,737 in March, according to Douglas Elliman. In Brooklyn, it was $4,818, although a StreetEasy search in that price point pulled up a lot of divvied-up older apartments in neighborhoods like East Flatbush and East New York and basement-level duplexes in Gravesend and Bensonhurst. The more alluring stuff, in prime brownstone neighborhoods close to transit and in-demand school districts, tends to go for significantly more: a Cobble Hill brownstone duplex three-bedroom posted on a local listserve, for example, is asking $11,500 a month for a summer sublet. “The $5,000-to-$7,000-a-month price point? Oh there’s nothing,” says one Manhattan broker.
None of this surprised the renters I spoke with, whose experiences had already confirmed as much. One woman living in a $3,500-a-month two-bed in Morningside Heights she described as “dark, with a cockroach issue” told me she was looking for more space on a $4,500-a-month budget (her boyfriend’s mom had agreed to help subsidize their rent if they found a place with a guest room for her). A broker she’d reached out to that morning had sent over some listings, including one for an apartment in the building next door that was identical to hers, except that it was carved up into three bedrooms instead of two. A recent post on an Upper West Side Facebook group from someone hoping for a $3,500 three-bed for June 1 was met with pity and disbelief. “Highly unlikely,” one person replied. “Especially on the UWS.” “Staten Island?” one suggested. “Would you consider NJ?” asked another.
“I think people are struggling to find something better than what they have,” says Paul Campbell, a communications consultant who was living in a two-bedroom condo in Downtown Brooklyn with his wife and son when COVID hit. Like a lot of people, he and his wife started working from home a lot more, their son turned 13, and the apartment’s shared living space started to feel cramped. But their two-bedroom apartment, which had a double-decker terrace they’d built out with a pergola and an apricot tree, was just so much nicer than everything else they saw. “My wife would take me on these tours and it was like, ‘We can afford this, but it’s horrible, everything creaks and it smells,’” Campbell says. Once, the seller of a Windsor Terrace house accepted their offer only to come back to say they’d been outbid. They offered a higher amount, had a handshake deal, and it happened again.
Campbell ultimately found a three-bedroom in a Red Hook condo development called the Conover. It did cost him over $2 million, though. Not unexpected, given that Brooklyn new development now exceeds $1,200 per square foot on average, according to Douglas Elliman. The odds are better in new development, where 20 percent of new development units in Manhattan are three-bedrooms (and 19 percent in Brooklyn), says Stephen Kliegerman, president of development marketing at Brown Harris Stevens. Although, they’re more expensive and often involve compromising on neighborhood. Kelly Scher, a Corcoran broker who bought a $2.6 million three-bedroom at the Solaire, in Battery Park City, loves her apartment (it has three bathrooms and a big foyer) but admitted she hadn’t exactly sought out the neighborhood, though it’s grown on her. Once she and her husband decided they wanted a three-bed under 14th Street, on the West Side, for under $3 million, it was the obvious choice. (It was pretty much that or the Financial District.) “I didn’t have to do too much looking around because there wasn’t too much to look at,” she says.
There are, of course, plenty of classic sixes and sevens uptown. But anything that needs renovation is sitting, brokers say, and buyers are fighting over any remotely turnkey apartment that’s not “optimistically priced.” Adjina Dekidjiev, an associate broker at Coldwell Banker Warburg, recalled how swiftly one of her listings, a renovated three-bedroom, two-bath at 305 West 98th Street priced at $1.65 million, sold. (That, apparently, is what passes for a bargain these days.) “I wish we had another one like West 98th,” she says wistfully. “There’s plenty of inventory, but it needs work or it’s overpriced,” says Robert Geils, a Corcoran associate broker. “People want perfect, but perfect costs a lot.” Senad Ahmetovic, an associate broker at Brown Harris Stevens, told me he’d listed a combo unit on Sutton Place South — a fully renovated three-bed, three-bath — and received more than 20 offers in a few weeks. He has another listing in the same building with a direct river view that needs work but is asking almost half-a-million less. No one is biting. “The older apartments are still expensive and they need work,” complained one buyer who’s been in the market for over a year. “On the Upper East Side, you could get a three-bedroom for under a million, but you would never want to live there,” one broker tells me. “Under $2 million is where it becomes difficult,” says another.
So what about everyone below that threshold? Mostly, people say they’re trying to make the most of what they have, focusing on square feet rather than walls, or lack thereof, in their current apartments. Sandy Earl lives in a Morningside Heights one-bedroom with her husband and four kids (and another on the way), but it’s a 1,000-square-foot duplex with outdoor space. They’ve outfitted the apartment with a triple bunk and a lofted bed for the kids and a Murphy bed for them. They love their kids’ school and don’t want to move, even though their landlord just informed them that their rent will be increasing from $4,400 to $5,100 a month. That’s up $1,300 in three years. Every year at renewal time, they go on StreetEasy, certain that for that much rent they can find if not a three-bed then at least a nicely configured two-bed. And every year, they’re wrong. “I feel like we’ve never made so much money in our lives and been able to afford so little in our lives,” says Earl. “But anything else that we want that’s this size with more doors is $6,000 or $7,000. And it’s just not worth it to pay that much more for more doors.” Even though, she added, she really would like a few more doors.
