This weekend The New York Times real estate section looked at people who are finding themselves priced out of Brooklyn. No doubt this has been going on for ages, but the story points to some pricing trends that show that real estate in Brooklyn, or at least in the most expensive north and western neighborhoods (from Red Hook north to Greenpoint and Gowanus and Park Slope) is quickly accelerating towards Manhattan pricing, particularly since the financial crisis in 2008.
According to the story, in the second quarter of this year there were 107 sales over $2 million in these neighborhoods, more than any other quarter. Since 2008 the median sales price has inched 33 percent closer to the median sales price in Manhattan–now $575,000 in Brooklyn versus $910,000 in Manhattan. Five years ago median rental price in these parts of Brooklyn was $1,030 cheaper than in Manhattan. Now it is only $353 cheaper. (more…)
This Romanesque Revival home and former House of the Day at 66 Midwood Street has just sold for $2,300,000, beating the neighborhood record for Prospect Lefferts Gardens by $450,000. The landmarked five-bedroom, five-bath house hit the market in March for $1,975,00. The 1898 townhouse is dripping with original details, including ornate wooden mantles, dressing rooms and four functioning fireplaces. It hit the public records last week. Its sale price blew through the previous record of $1,850,000, set by Dixon with its purchase of 36 Rutland Road in January.
The creme de la creme of Brooklyn listings is clotted. The handful of Brooklyn properties at the very top of the market, asking between $10,000,000 and $16,000,000 and sometimes more, aren’t moving. There’s a multi-million-dollar gap between asking and closing prices at the tippy top of the Brooklyn market.
The Real Deal took a look at the top 10 Brooklyn listing prices and the top 10 Brooklyn closed sales, and found a discrepancy. Since 70 Willow Place — where Truman Capote famously rented — closed for $12,500,000 in 2012, several higher priced properties have failed to sell, and it remains the borough record. (more…)
Not all Brooklyn neighborhoods are equal: The much-vaunted inventory shortage is easing off in some areas while it’s only getting worse in others. Inventory in Red Hook, Prospect Lefferts Gardens, Prospect Heights and Park Slope decreased the most in the last year, according to a detailed and fascinating look at Brooklyn real estate in The Real Deal. Guess where inventory is actually increasing?
Bushwick and Bed Stuy led the pack, with whopping increases of 45.5 percent and 41.5 percent in inventory over the last year. (more…)
Real estate firms have moved into Brooklyn in a big way, looking to capitalize on the popularity of the area and rising prices there. Big firms Brown Harris Stevens, Corcoran and Elliman “all increased their Brooklyn-agent head counts at least 32 percent in the last three years,” according to a long, data-based story in The Real Deal. (more…)
The Midtown-based real estate company RES opened up a storefront last month at 291 5th Avenue between 1st and 2nd streets in Park Slope. The company handles sales, rentals, commercial property and development. While the company has an office near Times Square, this location is its first storefront. As part of its Brooklyn expansion, the brokerage has hired several new agents and is already searching for more locations in the borough. Click through the jump for interior photos. GMAP
Hot on the heels of the New York Times’ story about real estate and gentrification in Crown Heights comes a look at Bed Stuy, where whites have become a noticeable presence and prices of town houses have soared in the last year. (more…)
The median sales price of homes in Brooklyn rose to $575,000 during the second quarter, an all-time record, according to a Douglas Elliman report out today. Homes in Brooklyn now sell for 6.5 percent more than they did at the peak of the last boom in 2007, and 4.5 percent more than the second quarter in 2013. (more…)
A story in The New York Times over the weekend described the rapid gentrification and changes happening in Crown Heights, as longtime residents and businesses move out and are replaced by newcomers. Many businesses have moved to Flatbush, and residents typically move to Flatbush, East New York and Brownsville, according to the story.
Developers such as Realty Within Reach, Hello Living and Brookland Capital, of course, discovered the neighborhood a few years ago, and “more than 1,250 units in about two dozen residential projects” are in the works, mostly west of Nostrand and north of Eastern Parkway, according to the story. While very few are “affordable,” Brookland Capital’s Boaz Gilad explains the appeal of a condo:
“Most of our buyers are people in their late 20s and early 30s who live in the neighborhood already, paying, say, $2,400 a month in a free-market building,” he told the Times. “With an F.H.A. loan or some help from parents or money they’ve saved, the cost of buying the apartment will be maybe $2,600 or $2,700 a month. So there will be no change in monthly costs, but they’re going to own an asset.” (more…)
Average co-op prices in north and northwest Brooklyn have spiked 71 percent since January to $687,000 and the average condo in Brooklyn now costs $1,080,000, according to a report from Ideal Properties. Both DNAinfo and The New York Daily News carried stories on the report, which is not yet available online.
A lack of inventory, especially of townhouses, is driving the increase, said an executive with the firm. Bidding wars are routine in Brooklyn, where inventory in general is lower than in Manhattan, an executive from Warburg Realty told DNAinfo.
As prices of brownstones in “emerging” areas push past the $2,000,000 mark, some flippers are changing how they do business. Out are the low-end, Home Depot-style renovations with 12-inch tan floor tile, country-style wood cabinets, and fake granite counters. In are $30,000 appliance packages, rear walls of windows, and central air.
“As the market changed, the clientele changed. Everything demanded a much higher grade rehab, higher grade finishes, and higher grade bells and whistles. If you’re dealing with $2,000,000 houses, it’s gotta look like $2,000,000 house,” said developer Adam Cohen of Stuyvesant Group. His company has about 20 projects in various stages, including rehabs in Brooklyn and rentals in Harlem.
It was Stuyvesant Group that renovated the narrow but detailed Amzi Hill house at 22 Arlington that reset the record for a townhouse sale in Bed Stuy when it closed at $2,250,000 earlier this month. As noted, the buyer was Australian investment firm Dixon.
One of the agents on the deal, Ban Leow of Halstead, said he expects prices in the area to climb even higher soon, because a group of bigger and renovated properties are about to come on the market. This was a premium house in terms of its details and renovation, but was less than 16 feet wide. Other houses that have recently closed at high prices for what they were in Bed Stuy and Crown Heights were full size with tremendous details but unrenovated. Three of those properties were also purchased by Dixon, as reported.
In Fort Greene, where renovated townhouses generally fetch $3,000,000 and up, Stuyvesant Group is renovating a brownstone to standards more typically seen in high-end custom renovations, including radiant heat on all floors that can be controlled from an iPad, a high-efficiency boiler, and replacing the back wall with glass and steel.
In Bed Stuy or Crown Heights, that renovation would be too expensive, but developers are still taking a high end approach vs. several years ago. “We never did the cheap stuff, it was always custom cabinets, better tile and hardwood flooring,” said Cohen. “We used to give a standard package of stainless steel appliances, and maybe now it’s [a more expensive] appliance package. It used to be quartz counters, now it’s Carrara marble.”
At 22 Arlington, for example, a new kitchen in the rear of the parlor floor, pictured above, has an Italian marble backsplash and center island, Sub Zero refrigerator, Wolf range and vent hood, Bosch dishwasher, a microwave in a drawer and custom made radiator covers. Wall-mounted split A/C units were chosen instead of central air conditioning to avoid unsightly ductwork in the detail-laden house, though Stuyvesant Group does install central air in the houses it gut renovates, said Cohen.
They also repaired all the plasterwork that could be fixed. The arch above where the stove now sits “was cracked into nine different pieces, and we fixed it,” said Cohen. The interior doors are original to the house, but not necessarily in the same places, since the layout was reconfigured. In Fort Greene, there was nothing to save, since the house had a fire so it was a full gut job, but they purchased three vintage pier mirrors and restored the front door (since the house is landmarked). “We try to give it that brownstone look, we don’t want it to have that condo look,” as Cohen put it. “I feel like in this market, if you give buyers something good, they are happy to pay for it. They don’t want to pay for garbage.”
Stuyvesant Group is already in contract on two other nearly finished houses it never even put on the market but struck a deal with buyers who were among the bidders at 22 Arlington, he said.
Buyers are “looking for well-configured homes,” said Leow. A triplex over a garden rental is ideal. They don’t like small galley kitchens but prefer a “very nice open space with lots of countertops where a family can actually enjoy their home and cook for friends.” As for gut jobs vs. preserving original detail, “every buyer who buys a brownstone wants a house full of period details,” said Leow. “If there are details, it would be shameful if someone comes in and rips everything out and throws it in a Dumpster. But sometimes investors buy a shell and there is nothing to salvage.” In that case, buyers “would rather see a high end renovation that will work” for a family, he said.
Problem properties that developers were picking up for $250,000 to $350,000 at the height of the bust and selling for $500,000 to $625,000 once they were renovated are now about $800,000 just for a shell — maybe 5 percent more if they are close to Nostrand Avenue. “Today we would buy them for more than what we sold them for even after rehab,” said Cohen. Another thing that has changed is buyers were highly leveraged before and now they are putting down at least 50 percent cash if not 100 percent. (more…)
Bensonhurst, a middle class Italian enclave for generations, is booming with Chinese immigrants. A similar transformation occurred in Manhattan’s Little Italy decades earlier. Bensonhurst is now officially 36 percent Asian, although informal estimates put it even higher, according to The Wall Street Journal.
Signs for businesses along 73rd and 74th streets reflect the changing demographics. “At the Sciacca Social Club, a large poster celebrates Italy’s 2006 World Cup win, while a few doors down, signs for both the Brooklyn Center for Musical Arts and C&K Art Center are written in both English and Chinese characters,” said the story.
Chinese are increasingly drawn to the area as they are priced out of Sunset Park. Real estate prices in the area are rising, driven “in part” by demand from Chinese buyers, according to brokers interviewed by the Journal. About 13 percent of the locals are Hispanic and 49 percent are white, according to Census data. Interestingly, the Asian influx is fairly recent, with the population “growing 57 percent between 2000 and 2010,” said the Journal.
The median sale price for homes is $699,000, which is 17 percent higher than the median for all of Brooklyn. The commute to midtown is about an hour on the subway.
The quality of life in the neighborhood is good, the streets are clean, and politicians listen to the locals, said the story. A BJ’s Wholesale Club plans to open in mid-September in a new shopping center on Shore Parkway and 24th Avenue.
One development residents are not so happy about, though, is a garbage-processing facility on Shore Parkway. Construction is supposed to start before the fall, and end in mid-2017. Locals say they are concerned about increased pollution from the plant.
Although not mentioned in the story, the area does have some older housing stock, including turn-of-the-last-century brick row houses and early 20th century apartment buildings. Would you consider living in Bensonhurst?