BHS Report: Brooklyn Up Less Than Manhattan
The second quarter market report from Brown Harris Stevens was released yesterday. It’s pretty thin on the Brooklyn data, which only the neighborhoods of Brooklyn Heights and Park Slope covered. Compared to the skyrocketing prices in Manhattan, the Brooklyn numbers are relatively blah. Townhouse prices in Brooklyn’s two fanciest nabes edged up just one percent,…
The second quarter market report from Brown Harris Stevens was released yesterday. It’s pretty thin on the Brooklyn data, which only the neighborhoods of Brooklyn Heights and Park Slope covered. Compared to the skyrocketing prices in Manhattan, the Brooklyn numbers are relatively blah. Townhouse prices in Brooklyn’s two fanciest nabes edged up just one percent, according to the report, to $578 a foot; meanwhile, studios were up 4 percent, one-bedrooms rose 2% and two-bedrooms dipped 4 percent. The $578 number sounds very low to us and has be getting dragged down by the South Slope since all the good stuff in prime Park Slope and Brooklyn Heights is more in the range of $700 to $900 a foot. More interesting than the year-over-year number, however is how Q2 compared to more recent quarters. According to the BHS report, average per square foot for townhouses in these two areas spiked to over $700 in 3Q 2006 before falling to $634 in the fourth quarter and $568 in the first quarter of this year. The second quarter number was almost two percent higher than the first quarter. But what about all the neighborhoods that are left out of the report? We suspect that there was something of a bifurcation of the market in which neighborhoods that were perceived to have made it safely over the gentrification hump saw prices bid up faster than those with greater perceived risk. Overall, we would expect to see more bullish results for the borough as a whole than the Slope and Heights numbers, which makes sense if you think of these two areas as the safe, low-beta blue-chip stocks.
This kind of scenario is awful… could it be about to happen here in Brooklyn by 2008-09?
What do you think?
“The hardest hit ZIP in California was Sacramento, 95823, where there were 634 default notices, repossessions and auction notices. It had the sixth most foreclosure filings for any zip code in the nation.
California boasts a vibrant economy and a fast growing population. According to Doug Duncan, chief economist for the Mortgage Bankers Association (MBA), foreclosures, overwhelmingly, used to come courtesy of serious underlying economic problems such as job layoffs or plant closings.
But the California foreclosure spike, as well as those in Florida, Arizona and Nevada, was set up by runaway appreciation that boosted home prices beyond affordability.
Double-digit price increases had attracted hordes of investors, who added to swiftly rising values. Developers bid up land prices in a scramble to get product to market. When markets cooled, speculators added to downward price pressure by unloading their properties onto already lengthening inventories.
“In many of these markets,” said Duncan, “prices fell below what investors paid. Many have simply walked into their banks’ offices and handed in their keys.”
The bubble is collapsing from the outside in. Learn to deal with it.
The NYC reals estate market has a “relentlessly cyclical nature.”
Think Coney Island “Cyclone”! 🙂
Welcome to Brooklyn!
I agree with all of the above posters who think that this report doesn’t say much. I was fortunate to have purchased in Ditmas Park before the prices skyrocketed and lucky for me I never even got mugged once! I have friends who are teachers, editors and otherwise gainfully employed in various professional careers who can’t even afford to buy a coop or condo here now. Please tell them where Brooklyn prices “are blah” so they can put in their offers.
It’s bad news for Brooklyn if the price gap between Brooklyn and Manhattan prices is widening, rather than closing, as it has been for a long time. Very sad indeed.
One has to wonder if this blog has helped or hurt Brooklyn’s overall rep city-wide, with all its attempts to drive down prices in Brooklyn.
Bren, That was funny!
The agency reports don’t have enough data for Brooklyn to be of ANY use really. That’s true for BHS, Corcoran, Halstead and Elliman. They just don’t do the kind of volume to allow an apple to apple comparison quarter to quarter or year over year. The REBNY numbers at least compile all the data from the REBNy firms, but not the many small independent firms that don’t share much of anything, including data. Then the other option is using public data. There is one appraisal firm that brownstoner found that had some more interesting, more relevant numbers in the past for Brooklyn. Brownstoner, can you please dig out that link and maybe you could call them and see when their new numbers will come out? I suggest you just ignore this data from the individual agencies in the meantime for Bklyn. Otherwise you can ask an agent to do market research based on sales that corresponds to the kind of property you are most interested in. This is useful if you are considering buying or selling. The other thing about all of this blind data is that it doesn’t take condition or other factors beyond size and area in to account. So a place that is a stone’s throw away from a gas station on 4th Avenue will get the same merit as a place on a gorgeous park block zoned for an in-demand elementary school, you get the idea.
come to think of it, folks are still getting robbed on those very same blocks… just with a smile and a handshake this time!
“You can’t even afford to buy a house on the block you got robbed on when you were growing up. It’s bitter sweet.”
And there were lots of those kinds of blocks in “Brownstone Brooklyn” a few years ago… 🙂