The Times isn’t the only publication that can spot a trend. We’ve noticed that The Gray Lady’s Real Estate section has lately featured an unofficial series on leaving Brooklyn (see this and this and this).
Is Brooklyn experiencing a real estate bubble that will never pop? That’s the claim of a very long article in Gothamist that examines record high housing costs in Bed Stuy and, more generally, the spread of high sale prices and rents outward from “prime” Brooklyn into “emerging” areas such as Bed Stuy, Bushwick and Crown Heights.
It’s a big grab bag that covers well-worn ground, such as publicly traded firms — most notably Australian REIT Dixon — beating out would be owner occupants of town houses with all cash. (more…)
The article is a Studs Terkel-like stream-of-consciousness 1,600-word quote from a racist Hasidic landlord who describes a variety of questionable and sometimes outright illegal money-making real estate schemes, from buying deeds on lis pendens property to driving blacks out of rental property and replacing them with whites. A sample quote:
The building was full of tenants — $1,300, $1,400 tenants. We paid every tenant the average of twelve, thirteen thousand dollars to leave. I actually went to meet them — lawyers are not going to help you. And we got them out of the building and now we have tenants paying $2,700, $2,800, and they’re all white. So this is what we do. My saying is — again, I’m not racist — every black person has a price. The average price for a black person here in Bed Stuy is $30,000 dollars. Up over there in East New York, it’s $10,000 dollars. Everyone wants them to leave, not because we don’t like them, it’s just they’re messing up — they bring everything down. Not all of them.
For decades, homeowners have been selling apartments in Manhattan and buying townhouses in Brooklyn. As the price gap between the two boroughs narrows and Brooklyn becomes a “primary destination,” according to a story in The New York Times, that dynamic is changing.
Now owners of apartments in Brooklyn’s most expensive areas, such as Dumbo and Boerum Hill, are selling and buying apartments in Manhattan’s bargain neighborhoods — which now include the Upper East Side. (more…)
Sales prices in Brooklyn climbed for the 10th consecutive quarter, setting a new record, while rents finally seem to have stabilized. That’s the overall picture we drew from data in reports out today from Douglas Elliman and Corcoran, confirming what we’ve been seeing in the market recently.
The Elliman report, prepared for the firm by Jonathan Miller, president of Miller Samuel, showed the median sales price for a home in Brooklyn was up 17.5 percent in the first quarter of this year over the same period last year to a record of $610,894. The median condo sales price hit a new record at $729,750. The median sales price for a one- to three-family home was up 26.9 percent over the first quarter last year to $744,000.
One of the biggest jumps in price was for two-family homes in northwest Brooklyn — the swath of 16 neighborhoods from Brooklyn Heights to Park Slope, from Fort Greene to Dumbo. Prices for those properties were up 46.2 percent over last year. (more…)
Home prices in north and northwest Brooklyn continue to rise at a rapid pace, according to a report Ideal Properties released Wednesday. Closed sales were up 21.6 percent in the first quarter over the same period last year.
They were even up 7.1 percent from the previous quarter even though the winter tends to be a slow month for home sales. And the time from listing to closing grew shorter decreasing by 10.5 percent from the same time last year. (more…)
The bank headed for the corner of Marcy and Fulton in Bed Stuy will be TD Bank, a rendering on the construction fence shows. When we passed by 957 Marcy Avenue Friday, demo of the old Burger King was fairly far along. Click through for lots of photos.
As we’ve said before, we think a taller mixed-use building would be a more efficient use of space here — and it would fit in better with the area — than the standard one-story building surrounded by a parking lot shown on the rendering. But the plan is to replace like with like, so it is not to be.
As for the bank, there are also Chase and Citibank branches nearby. Do you think TD Bank — and the parking — will be a useful addition?
The Fed Reserve has been warning for years it plans to raise interest rates, but never follows through on the plan. It gets scared because the economy doesn’t look good, and then backs off. The Fed warned yesterday that it could raise rates in June.
Just the warning could send folks running to brokers to refinance (again) or buy something asap. If the Fed were really to do it, it could depress home prices — or more.
Crown Heights has shed its past association with riots and now stands for the real estate boom, according to a story in am New York. The story described soaring prices for homes and other trends familiar to readers of this blog, such as new apartment buildings being built from the ground up and landlords buying and selling existing apartment buildings in remarkable numbers:
Meanwhile development has surged. Crown Heights had more apartment-building transactions between October 2013 and March 2014 than any other neighborhood in the city, according to Ariel Property Advisors. The average condo price rose to $748 per square foot from $521 between 2012 and 2014, and land prices soared to $178 per buildable square foot from $94.
But development has brought displacement, the story said. Do you agree with MTOPP President Alicia Boyd’s estimate that 30 percent of longtime residents have left in the last two years?
We read with great interest in the Daily News that prices are so high now in Bed Stuy, investors are fleeing the area, which means it’s going to be easier for regular people — that is, owner-occupants — to buy there. The story didn’t quote any actual investors, though, so we spoke to a few.
Their take? We are entering the next stage of gentrification and prices are still increasing. Investors are not pulling back, and properties are not sitting on the market. (One source we spoke to had just sold one $2,100,000 property a few weeks ago and has a closing date for another $1,850,000 property next week. A commercial broker was prepping for a Bed Stuy closing later this morning.) But buyers are getting smarter, said one.
Here are a few representative quotes:
“The real story is that owners/brokers are pricing things 30 to 40 percent higher year over year so they aren’t selling! But anything that’s about 10 to 15 percent higher then 12 months ago sells like fire. Prices are still up 20 percent year over year on any asset type!”
“There are bidding wars on every house! Investors didn’t pull back! It’s the opposite! End users became savvy and are bidding on houses that are in the need of work!
“Bed Stuy has a bigger pool of buyers for all asset classes than ever before.”
And here is what Alan Dixon, head of one of the biggest Bed Stuy investors, had to say. (Dixon is Managing Director and CEO of Dixon Advisory USA. Part of a publicly traded Australian company, Dixon buys, renovates, and holds to lease out, not flip.) (more…)
Do new, so-called “luxury” apartments seem to be getting smaller? It’s not your imagination. Land costs in Brooklyn are rising quickly, and so developers are squeezing more apartments in per building to make the profits pencil out, The New York Times reported over the weekend. (Sorry, we’re just getting to the story today.) To justify keeping the rents the same, they are adding ever-more baroque amenities.
We’ve noticed lots of high-end apartments (condos as well as rentals) that have strip kitchens in the living room, a space-saving move that seems more reminiscent of “SRO” than “luxury” to us. At the same time, the bathrooms keep getting bigger and more numerous.
Curiously, there’s a technical reason for that: The building code has changed and now requires more clearance for things like doors, resulting in larger bathrooms.
The lion’s share of new apartments in the City is going up in Brooklyn, with 6,500 new rental units and 134 buildings expected to open this year. (That’s double last year’s count of 2,981 units in 36 buildings.)
The story mentioned a few forthcoming big Brooklyn buildings: AvalonBay’s 100 Willoughby Street, City Tower at 336 Flatbush Avenue Extension (City Point Phase 2, pictured above), 247 North 7th in Williamsburg, and Madison Realty Capital’s 490 Myrtle Avenue in Clinton Hill.
In addition to the now-standard amenities in new luxury buildings, such as lounges, fitness centers and even roof decks, some buildings will also feature a basketball court, a lawn, and, at 100 Willoughby Street, “a dog run with separate places for small and large dogs to play and a heated pergola for owners.”
We expect land will only continue to get more expensive.
Check out this New York Times video about Bed Stuy, the first in a new monthly series, “Block by Block,” about what it’s like to live in various New York City neighborhoods. We recognize lots of friends and neighbors in the piece.
It covers a lot of ground, including Bed Stuy’s heritage, beautiful brownstones, distinguished residents such as the late Shirley Chisholm, rapidly escalating rents, crime and Bed Stuy’s family-friendly environment. We recognize Peaches, Scratchbread, Bed Stuy Fish Fry and lots of other local businesses.
Brownstoner commenter and real estate agent and preservationist Morgan Munsey, Georges-Andre Vintage Cafe owner Karine Petitnicolas (aka SuperFrench), and Eduardo Mantelli of Saraghina all have cameos — as do many others. What do you think of it?