Manhattan rent prices soared to an all-time high in July, coinciding with a historic drop in available rental inventory and the peak of the summer leasing season, which intensified the supply-demand imbalance.

According to the latest data from real estate appraisal firm Miller Samuel Inc. and The Real Deal, the median rent for newly signed leases reached $5,000 in July, a 6.4% increase year-over-year. This surge is double the rate of national housing cost increases, which the U.S. Bureau of Labor Statistics reports rose 3.2% year-over-year.

Alongside the rent spike, the supply of available listings has sharply contracted. Last month, the number of listed rental properties in Manhattan plummeted by more than 39% compared to the same period last year, a decline rarely seen in the past decade. This trend has also spread across the East River. In Brooklyn, the median rent in July also hit a record high of $4,500, while the number of listings fell 27% from the previous year.

Jonathan Miller, market director at StreetMatrix, stated that a portion of the decline in listings is due to an increasing number of properties moving to the "off-market" market. Landlords and brokers are increasingly choosing not to list properties on public platforms like StreetEasy or RentHop.

"This is not normal," Miller noted. "A large volume of listings is being shifted to paid channels, making them invisible to the general market participant."

Miller added that despite record rents in Manhattan, leasing transaction volume has dropped by nearly 19%. This suggests that the driving force behind the rent increase is not solely strong demand but also a significant scarcity of available properties.

Some tenants are paying hefty fees in their scramble for housing. To gain access to information on unlisted properties and avoid fierce competition, some renters are paying brokers up to $4,000. Others, like Mollie Sheperdson, are left to compete for limited public listings.

Data from Miller Samuel Inc. shows that more than one-quarter of apartments in Manhattan are ultimately rented out only after a bidding process among tenants. Sheperdson, 35, began her apartment search in early May, inquiring about over 100 listings and physically viewing 20 apartments.

On one scorching day, she found herself packed into a basement studio in Chelsea, Manhattan, with more than 30 other prospective renters. The apartment was listed for $2,500 a month. She even spent consecutive nights glued to StreetEasy, waiting for new listings to appear at midnight. Sheperdson eventually secured a studio on the Upper East Side for $2,000 a month, with a lease starting in July.

"The whole process was insanely unbelievable," Sheperdson said. "You really have to invest a huge amount of time and be prepared to drop everything at a moment's notice. On weekends, when I went to open houses, I often found 50 other people there. The entire experience was sheer chaos."