Corcoran '07 Market Report: Brooklyn's Still Up
The Corcoran Group released its year-end market data today, and the brokerage’s stats show the ’07 Brooklyn market making healthy (if not huge) gains over 2006. The median sales price on all condos and co-ops was up 7 percent last year, to $590,000, while median townhouse values rose 2 percent in ’07, to $1.2 million….
The Corcoran Group released its year-end market data today, and the brokerage’s stats show the ’07 Brooklyn market making healthy (if not huge) gains over 2006. The median sales price on all condos and co-ops was up 7 percent last year, to $590,000, while median townhouse values rose 2 percent in ’07, to $1.2 million. The really fun part of the report, however, is its breakdown of how various neighborhoods have fared, sales- and price-wise (see chart on jump). The big winner? Brooklyn Heights, where the median price shot up 19 percent, to $1.3 million. Cobble Hill/Carroll Gardens, on the other hand, showed a median price decrease of 9 percent, going from $950,000 in 2006 to $860,000 in 2007. And Park Slope’s median price slipped from $999,000 in ’06 to $928,000 in ’07. We have a few reservations about this report, including that it doesn’t specify the total number of sales it tracks, that it only compares year-over-year values, and that it basically only covers the priciest brownstone neighborhoods—though we have to give it up for the big C for devoting so much ink to Brooklyn sales data. The article in the Times this morning about the record-setting fourth-quarter Manhattan market notes that Brooklyn’s gains were more “stable” than Manhattan’s. Brooklyn showed its maturity this year because the appreciation was much more steady, said Corcoran Group president Pamela Liebman. Anyhow, do these numbers jibe with pricing trends you’ve noticed over the past year?
Apartment Prices in Manhattan Defy National Real Estate Slide [NY Times]
Photo by threecee.
11:28…
15 year ago, new york city was a complete and total shitshow.
people were leaving the city in droves, there were 2200 murders a year and the city was falling apart.
now it is cleaned up and one of the most prosperous cities in the world.
not taking that into account into your little comparison about 15 years ago is beyond foolish.
11:21 here – in case it wasn’t clear, my back of the envelope number for mortgage interest sunk costs was for the additional monthly interest cost OVER AND ABOVE my current rent ($2600) and was, if anything, way too low if we’re talking about three bedroom apartments in the $1.2-1.5m range (what I’m looking for).
Admittedly, unlike me most buyers in this range are also sellers, but I’ve been in a 2 bedroom Brooklyn Heights rental for 5 years because until recently I wasn’t sure if my wife and I wanted to raise kids in NYC.
Once again, this discussion seems to be devolving into a battle of potential buyers (seeking a market correction/crash) and buyers/sellers, denying that things can really go down. I am in the middle, as both an owner and a seeker of another property. Only 15 years ago, people, there was a major real estate correction, and yes, people who waited were better off waiting, even if they sunk another 20K into their rental in the meantime. It is simply not true that prices can only go up, and that they never go down. Check out some of the HOTD on this list that have their prices slashed hugely since the properties just sat at their initially over-inflated asking prices. That said, will the market have a huge crash? Probably not, but will it have a significant correction? Seems likely. Will prices eventually go back up? Yes, almost certainly (barring some catastrophe in which case we’ll all have bigger fish to fry). But adjusted for inflation, it is not necessarily the case that RE is an incredibly great investment. Most of the people on this list just need a home to live in, and if that’s the case, keep looking and take your time. Over the long term, it’s true that you will be OK even if you buy a bit high, but I for one would rather be a smart shopper and buy a property at a 15% discount as long as I’m fine where I am now…
11:21 – Have you thought about the incredible tax dedutions you are missing out on to offset your interest expense?
11:21…
you mean to tell me you’ve been sitting on 300K in the bank with 4.5 % interest….for how long exactly????
my god. if you haven’t jumped into the market by now, i’d say you will probably be a renter for life.
i’m guessing it’s taken years and years to save that money. you just sat back and watched the largest real estate boom in u.s. history and now want to tell everyone how smart you are for not buying???
i made 300K on my home purchase between about may of 2003 and june of 2004.
11:08 – and what of the money you give to the bank as interest, to the building as maintenance, to the insurance company for liability and the contractor for repairs????
The amount of money that goes into “equity” is relatively small and even smaller (or negative)if your home value is falling.
“Last night the gas station was empty and McD’s at Atlantic and Vanderbilt. Flatbush was a fucking ghost town too.”
“The What stalks the streets at night, hungry for victims.”
I think the what cleaned my windshield with spit and crumpled up newspapers last night. I gave him a dollar because I felt bad.
Supply and Demand only has long term effects on markets – in the short term the biggest driver of prices is psychology (see oil prices).
The prices of homes in NY will continue to appreciate as long as people believe the prices will appreciate….and once that changes the prices will fall.
Just like there is NOTHING in the supply/demand equilibrium that caused oil to go from $10 a barrel to $100 a barrel in 10 years there is NOTHING in the supply/demand equilibrium that justifies 300% increases (or more) in Brooklyn Real Estate over that same period.
Once high oil prices, wall street layoffs, etc, etc, begin to effect the psychology of the New York Real Estate buyers and sellers the prices will fall and dramatically in some cases. In fact if history is any guide, the prices will then fall to unjustifiably (based on supply and demand) low levels and then we will start all over again.
10:58/11:08 – look, we’re not just talking about my rent over the next year (admittedly a sunk cost). You have to add to that 1) lost return on the $300k+ down payment I’d have to make to get a nicer apartment than the one I’m renting (even at the 4.5% return I get on my money market account this cancels out half of my rent cost) PLUS 2) the extra sunk interest costs I’d have to pay on my mortgage (at least $1500 per month) PLUS 3) maintenance costs (approximately $1200 per month). Now, if I saw an apartment I loved that all might be worth it, but again, it isn’t just buyers who are sitting on the sidelines right now and everything I’ve seen has been pretty crappy and very overpriced (see, e.g. the PS apartment from yesterday’s posts).
I’m not trying to time the market, but I’m also not foolish enough to sink my hard earned savings into an asset that will potentially depreciate signficantly over the short term, especially since I don’t think (and here we are in the realm of my opinion vs. yours) that I have anything significant to lose by waiting a year to buy.