Risky Business in Some Brooklyn Nabes?
This week New York magazine looks into its real estate crystal ball and sees all sorts of doom ‘n’ gloom on the horizon for Bed-Stuy, Bushwick and, to a lesser extent, Williamsburg and Greenpoint. Of all the neighborhoods profiled in the mag’s Neighborhood Watch feature, in fact, Bed-Stuy and Bushwick are pegged the riskiest. (They…
This week New York magazine looks into its real estate crystal ball and sees all sorts of doom ‘n’ gloom on the horizon for Bed-Stuy, Bushwick and, to a lesser extent, Williamsburg and Greenpoint. Of all the neighborhoods profiled in the mag’s Neighborhood Watch feature, in fact, Bed-Stuy and Bushwick are pegged the riskiest. (They receive a collective risk rating of 9 out of a possible 10.) According to the article, since the two areas are subprime hotbeds, there’s a good chance inventory is going to be flooding their markets–an assessment that jibes with the downturn in sales Bed-Stuy recently posted. In Williamsburg and Greenpoint, meanwhile, the supply of new construction may be outstripping demand. One local broker says Burg prices have sunk by about 10 percent lately. The article also makes the case that properties in Greenpoint, and areas of Williamsburg not within a stone’s throw of the Bedford L, are going to be less of a hot ticket as “creative types” find exotic mortgages harder to come by. These factors combine for a risk score of 7. (The rating for “established brownstone Brooklyn” is, unsurprisingly, a much rosier 2.5, based on the fact that areas like Brooklyn Heights and Park Slope attract affluent, stable buyers.) While Bed-Stuy and Bushwick are undoubtedly feeling more subprime fallout than other neighborhoods, it seems a little premature to predict that demand and prices in Williamsburg are about to take a serious nosedive. You agree with the pessimistic prognostications?
Neighborhood Watch [New York]
Big Slowdown Seen in Brooklyn’s Poorest Zones [Brownstoner]
Photo of Bed-Stuy houses by GKJarvis.
Well it will be interesting to watch what happens. I think that Clinton Hill has topped off and is already in its price reductions. Recently there has been a lot of open houses, one being a block away from our place with a big price cut. I think the Clinton Hill Coops are going to see a major correction, as they are way too much for their worth at this point. The good brownstones should hold their value, but these are few and far between.
Between the Atlantic Yards development and the local schools I just can’t see any further increase.
“Give me control of a Nation’s money and I care not who makes the laws.” – Mayer Amschel Bauer (Rothschild)Â
Good day to the clueless. I will let this statement sum up my feelings.
“Creative financing is DEAD! Interest-only ARMS, 80/20 financing and other toxic mortgage products are no longer available. The days of easy lending are over and this will affect ALL neighborhoods.”
Amen Amen.
The What.
BTW The Fed meets today, hold on to you houses….
I agree that it’s unfair to call hipsters “pioneers” because it completely glazes over existing residents. Unless you want to sound like a conquering people, ‘pioneer’ probably isn’t the right choice of words.
There are like a gazillion new units being constructed in Williamsburg, it is crazy! People actually think that all of these units are going to be sold? The only way prices won’t continue to go down in Wburg condos is if more than a few of them switch to rentals…
“For the rest of us, who actually LIVE in our houses [and who had the minimum of sense needed to not take out a mortgage on which they couldn’t make the payments], this means relatively little.”
Yup. Divorce, job loss and relocation are highly unlikely.
“In other Brooklyn hot spots, Gallant says, quite a few recent buyers could soon “wake up and say, What was I thinking?†”
These are the people who never should have bought homes in the first place, so they should get out of the market, in my opinion.
I think this is a ridiculous statement. I love Brooklyn and I love my home. If you tell me that tomorrow my place is worth 10% less than it was today, I absolutely would not care. This is my home.
In Bed Stuy, it’s so different from area to area within the large neighborhood to make a sweeping judgement of any kind about it. But so is Sunset Park and South Slope! Those neighborhoods exhibit this quality so dramatically. And yet everyone says it’s okay to make the sweeping statement those areas are a fabulous place to live. Even if one street is skanky in South Slope, and the very next one can be lined with houses and be lovely. In Sunset Park, one block can have tenement apartment buildings and dudes hanging out front blasting music all hours of the day and night (I’ve seen it) and another block can be nice and quiet. But we never hear that portrayed honestly here. No, I don’t live in Bed Stuy. I’m PLG’s LM. As for our own neighborhood, there seem to be too many longtime homeowners (20 or more years, both white and black) for foreclosures to occur, so far. One thing to consider about Bed Stuy, or in any of the old-timer’s neighborhoods there’s a danger of descendents inheriting a house and take out big subprime loans in order to get quick cash. That might even be what happened in Bed Stuy, more than it being newer homeowners not making their mortgage payments. If that’s the case, it shouldn’t mean people won’t keep buying houses in Bed Stuy.
test the what
12:06….While what you say is I’m sure true, you are not looking outside the box very well.
Many people in Bed Stuy might own multiple properties and own their homes outright, but MANY MANY people in Bed Stuy do not. They are the majority. Bed Stuy still has a median income hovering around 20K per year so please do not delude yourself into thinking that everyone around you is as well off as you are.
But most people, even on this board, buy a house 70% as a home – a place to put down roots, and raise a family, or be comfortable in your own space. 30% of thinking may be towards resale in the long distant future. It’s not like trading Yahoo stock. If you are flipping houses, or looking to move up and out in a couple of years, then maybe you will be disappointed in your investment, because that’s all it is. But if you are buying a home, where you expect to live for a very long time, chances are you’re not obsessively checking the market at every opportunity, and will weather out any small ups and downs.