As Condo Sales Languish, Builders Slam 421-a Reform
The Sun has a couple of articles this morning that, taken together, seem slightly contradictory. First off, Mike Stoler writes about how condo sales at many new Brooklyn developments have seen better days. (AKA condo glut.) Developers say that many for-sale condos in Downtown, Dumbo and the Burg are seeing price cuts of 15 to…
The Sun has a couple of articles this morning that, taken together, seem slightly contradictory. First off, Mike Stoler writes about how condo sales at many new Brooklyn developments have seen better days. (AKA condo glut.) Developers say that many for-sale condos in Downtown, Dumbo and the Burg are seeing price cuts of 15 to 20 percent and that many Brooklyn builders are considering turning their projects rental. One unsourced industry leader has this to say: There has been massive overbuilding in the entire borough of Brooklyn. It is like the Wild West, and if you don’t control growth, then at some point it’s going to get out of hand.” The other story in the paper is about how developers are psyched that in December the City Council is going to review the changes to the 421-a program, which, effective in July, requires that projects in many sections of the city (including the Slope, Prospect Heights, and Bushwick) include 20 percent affordable housing in order to get 421-a tax abatements. In other words, while sales are at a standstill at many developments (a whole lot of which benefited from 421-a), developers want 421-a tax breaks reinstated in order to incentivize the construction of more market-rate housing. Yes, 421-a repeal would mean cost-savings for buyers in the future, but right now those buyers aren’t keen on plunking down money for all the condos we already have. So the question is, does is make sense to incentivize the creation of new housing at a time when the existing pipeline isn’t being absorbed? Or is there still plenty of need and demand for new housing, just not at these prices?
The Divide Between Manhattan, Other Boroughs [NY Sun]
Tax Abatement Debate To Be Revived [NY Sun]
I wish they’d demolish that building shown in your pic. Its totally out of context for the street. Also the tallest bulding around was the chrich spire until they put up that ugly shambles.
Where are the cuts? Most of the condo I have seen selling are at 700+ dollars a sq ft. I bought my condo for 450 a sq only 2.5 years ago. Prices may be dropping but it is certainly not cheap yet nor will it ever be cheap.
Now if prices would start dropping in Bayhead NJ I would really be happy.
The Argyle is in “a prime area” like Ralph Nader is a legitimate presidential candidate.
Montrose – 1st of all “Condo” is a type of ownership arrangement – not a type of apartment (or townhouse) – in reality except for a relatively small percentage of people in NYC who want or can afford a private home (like a brownstone,limestone or Victorian) – therefore the market for “condo” is virtually everyone else who is looking to own in NYC. So I highly doubt that being a “condo” is the problem.
All that being said – I love how now the “brownstone Community” is upset or somehow disgusted that there are too many condos causing a glut – the reality is that I (and a few other economically grounded people here) have said for years that this building is good because it will help reduce the “affordibility problem” that was what the “brownstone community” was complaining about a year ago.
That being said the idea that there is a “glut” is just ridiculous. The best evidence of “glut” is in prices – and so far prices have softened but not that much. Further inventory while high for recent standards – is extremely low compared to other cities even in pre-bubble growth times. Las Vegas has a GLUT – Brooklyn has a normal SUPPLY.
Anyway ultimately all that will happen (assuming the financial markets dont implode and Government intervention doesnt destroy the economy) is that prices will come back into equilibrium with incomes – which in the long run is good for NY and the less than uber-rich. This cycle is as old as NY and is the reason that virtually all non-public housing in this city was at least at one time built for middle class or better.
10:57 In early 2006 we bought our 2 bed 1277 sf Prospect Heights condo for 450K.
Today, it was appraised at 600K. I’m glad we took the leap. Also as a family, at that time we bought, with a HHI of close to 200K, we were told we can afford an 800K condo.
I am glad we didn’t listen and stuck to our budget, if we didn’t we would have lost our home by now (one of us was laid off).
“The Argyle in Park Slope is already 50% sold out.”
There as been NO WORK done on that site for about TWO MONTHS now.
That project appears DEAD in the water as far as I can tell.
I’m just thinking about buying in Brooklyn and I’m already 25% richer.
I was looking at condos two years ago, and decided that it was cheaper to rent. I have kept on looking, off and on, mostly out of curiousity for the last two years. I have not seen any real price increase in Brooklyn Heights, Cobble Hill, Carrol Gardens or Park Slope. Though, I can’t say that I’ve seen much of a decrease either. I don’t know about other areas.
“But will it get funded?”
The properties already closed, ahole.
So yes.