Brooklyn Prices Up 8% in '06, Appraiser Says
According to appraisal firm HMS Associates, the average sales price of single- and multi-homes in Brooklyn rose 8 percent in 2006, despite a drop in the number of transactions. “The Brooklyn residential market was very strong in 2006,” says HMS Associates founder Sam Heskel. “We expect 2007 will be another good year, but home prices…
According to appraisal firm HMS Associates, the average sales price of single- and multi-homes in Brooklyn rose 8 percent in 2006, despite a drop in the number of transactions. “The Brooklyn residential market was very strong in 2006,” says HMS Associates founder Sam Heskel. “We expect 2007 will be another good year, but home prices will come back down to earth somewhat, with transactions up moderately.” In Brownstone Brooklyn, the biggest price increase came in Brooklyn Heights, where prices jumped 16.6 percent, from $1,831,857 to $2,136,891. The study also cites big rises in Boerum Hill, Carroll Gardens, Williamsburg, Bay Ridge, Park Slope, Greenpoint, and Crown Heights.
Brooklyn Home Prices Rose Nearly 8% in 2006 [Market Wire]
Photo by Adam Brock
(Let’s get a little realisitc WT economist. You own a house a WT that you think shuold be woth $348K, not $1 million.)
I actually said $600k; someone else said $348K. For a one family house that is not a brownstone, but a 17-foot wide brick rowhouse (ie. Philly, Baltimore). On the assumption that places closer to the center are becomming more valuable relative to those farther away, and that only the affluent (two grad degrees) will be able to own family-sized units this close to Manhattan in the future.
Even with all that, it’s still too high. As in 1997. Read through the post I linked. After that bubble and bust, I assumed people had learned their lesson and it would never happen again.
Let’s get a little realisitc WT economist. You own a house a WT that you think shuold be woth $348K, not $1 million. Say someone wanted to buy your house for $348K. At 20% down, you’d have a mortage of $278K. At 6% interest, your annual interest expense is $16K. Assume $2K in taxes and $3K for inusurance and you have so you have $21K in annual costs. Your house is likley a triplex with rental or a double doublex. If it’s a triplex, you rent out the garden for $1,800 a month which means your rental is covering all your costs. Someone sees they could live for free in your triplex. I think they’ll bid up the value of your house.
anon 2:05 — 1994 was the absolute trough of the last housing slump. Even if your assumptions are all correct, it’s totally cherrypicking to use that as the starting base to calculate the “fair” value of NYC real estate.
Also, people love to say that real estate is overvalued because most people can’t afford to buy in NYC. But most people in NYC have never been owners; something like two-thirds rent. If housing is overpriced, it’s for another reason.
Finally, WT Economist, since I figure you really know something about this stuff (unlike me): can you explain the basis that you think your house should be worth around $600K? I’m not disagreeing, but am curious–do you calculate that as some multiple of average incomes, or what?
Actually prices are droping at Schaefer Landing. Just check craigslist frequently and you will see the depression of the sellers.
Schaefer Landing is probably overpriced.
We bought a condo in the Roebling Square complex which sold quickly thru Douglas Elliman because it was priced well and the location is excellent (Roebling bet. N. 7th and N. 8th). The Mill sold fast too for similar reasons.
Schaefer Landing is really very nice and those apartments with views must be terrific, but the location is too far south.
not stunned at all actually.
but i don’t see your point? i think most people here are talking about brownstone brooklyn of which williamsburg is definitely not a part.
i for one love all of brooklyn (live in ps), but you couldn’t pay me to live in williamsburg.
“The study also cites big rises in Boerum Hill, Carroll Gardens, Williamsburg, Bay Ridge, Park Slope, Greenpoint, and Crown Heights.”
Aperantly the results of this study indicating a rise in the williamsburg market is pretty exsagurated. Just take a look on the schaefer landing project @ 440 kent ave. With sales going on for more then a year and still most of the building is empty.
Click on the following links and you will be stuned
http://halstead.com/results.aspx?Page=1&p=1&address=440+kent
http://www.elliman.com/MainSite/Search/search.aspx?Search=Quick&RentalMulti=1&Transfer=440%kent
http://newyork.craigslist.org/search/hhh/brk?query=440%20KENT
http://olr.com/newolr/search/ser_buildinginfo1.asp?bid=27655&frombuildingsearch=yes
http://www.siroffices.com/
http://www.c21nyc.com/Rental/17711/1/382555.aspx
http://www.citi-habitats.com/showsales.php?quick_search=440_KENT
http://www.sublet.com/spider/supplydetails_adv_data.asp?SupplyID=436079&source=10037
http://www.sublet.com/spider/SupplyDetails.asp?SupplyID=488507&SupplierID=19021&state=NewYork&city=Brooklyn&StateCount=More
http://www.bestaptsnyc.com/index.cfm?page=details&id=17973
http://www.bestaptsnyc.com/index.cfm?page=details&id=16917
http://espanol.clasificadosnewyork.univision.com/bienesraices/clasificados/ViewAd?oid=oid%3A1594242&name=condos%20for%20sale
anon 2:11 PM, so what you are basically saying is that only the rich will move to Brooklyn.
And to think it was it’s middle class roots that made it popular. This “new” Brooklyn doesn’t sound like an exciting one to me.
Surely the best model to value houses with is to compare the rental yield
(annual rent-costs)/house market price
to the yield on treasury’s….My own house yields about 5.8% right now versus 4.5% for the treasury market…..I’d be interested to know what these numbers looked like in the late eighties….