Elliman: Brooklyn Market Improved in 2nd Quarter But...
Sales volume in Brooklyn leapt 20.4 percent between the first quarter and second quarter of 2009 and the median price of co-ops and condos ticked up 2.9 percent, according to a report out this morning from Prudential Douglas Elliman. “It suggests there was pent-up demand from unusually low activity,” said Jonathan Miller, CEO of real…
Sales volume in Brooklyn leapt 20.4 percent between the first quarter and second quarter of 2009 and the median price of co-ops and condos ticked up 2.9 percent, according to a report out this morning from Prudential Douglas Elliman. “It suggests there was pent-up demand from unusually low activity,” said Jonathan Miller, CEO of real estate appraiser Miller Samuel, which compiled the report for Prudential Douglas Elliman. Before everyone breaks out the champagne and declares the real estate market in recovery, though, the report also notes that volume was off 29.7 percent versus a year earlier. Prices were also down dramatically from a year earlier; for example, the average price of a one- to three-family home in Brownstone Brooklyn fell 15.9 percent. “Unemployment is still rising, credit has not loosened and we still have a very weak economic environment,” Miller said. Click on chart above for larger view.
Brooklyn Market Overview 2Q 2009 [Elliman]
Home sales in Brooklyn, Queens rise as prices tumble [NY Daily News]
Glimmer of Hope for Brooklyn Market [NY Post]
I love the “holy hand grenade of Antioch” scene.
“Snark – is that the one where he keeps chipper and upbeat even as things are progessively chopped off?”
Oh yeah, I remember that. Blood all squirting out. Nice one, ‘Snark.
***Bid half off peak comps***
BHO: (Kris, you said “If you have a long timeline, the math will most likely work out nicely in your favor”. What exactly did you mean by that?)
I meant exactly what I said: that you have to take into consideration the total cost of renting vs. the total cost of owning. For the record, I am not by any means saying that buying is always cheaper in the long run. I think new construction condos, for example, will most likely wind up being more expensive than renting. But if you do the math for a specific property and base your purchase on the math, you will likely come out ahead.
The cost of renting is easy to figure out in hindsight. Projecting into the future, you have to figure that rents typically rise. Not every year (as right now), but most of the time.
Calculating the cost of owning is trickier, even in hindsight. It is also really very specific to each property. But some factors:
*You start with a down payment, and when all is done, you have to figure what you would have earned in interest on it. Some years, interest rates suck (like right now) so you have to figure real rates not hindsight / fantasy rates.
*Maintenance (if a co-op). High maintenance is a deal breaker for me personally. Maintenance will likely rise, but if there’s an underlying mortgage that is set to be paid off soon, it will offset the rise in other costs.
*a fixed mortgage payment will never rise.
*interest on mortgage saves you money on taxes, so factor that in.
*you also build equity as you pay the mortgage. Which means you get to keep more of the selling price (whatever that may be) in the end.
*once mortgage is paid off, the main monthly expense is only maintenance which will be only a small fraction of going-rate rents
*inflation
* of course — and I am sure this is what you’re getting at — the selling price when you’re ready to leave is a big factor in how much owning actually cost you. But even if you don’t sell at an inflation-adjusted profit, you can still come out ahead. I’m sure you don’t believe me. But there are co-ops for sale right now in Harlem that are cheaper to own than to renting similar apartments.
If your monthly nut to own is less than the monthly rent on a similar place, you will come out on top the vast majority of the time. (Unless you have to leave in a hurry or bought a place with a tax abatement.)
thanks Tinarina good info to know, and congrats on the aprreciation.
Snark – is that the one where he keeps chipper and upbeat even as things are progessively chopped off?
Brickoven–summer/fall of 2007. I was paying close attention as we were thinking of selling.
> It’s not likely because Unicorns don’t fly.
Precisely my point.
Tinarina when would you say the prices peaked for Clinton hill?
“And I want a pet flying unicorn, DIBS, but that’s not likely either.”
It’s not likely because Unicorns don’t fly. You need to look for a reputable Pegasus breeder. They fly.
Do I have to teach you people everything?