Key Highlights
- Possibility of rebound in sales market in boroughs beyond Manhattan
- Deep and continuing discounts in parts of rental market
There were two bright lights in New York City’s sales markets in December…Brooklyn and Queens. Both boroughs reached new median sale price records in Q4 2020.
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The median sale price in Brooklyn hit $875,000, an increase of +9.4% from one year ago and in Queens, the median sale price hit $668,000, a +9.5% bump. Manhattan’s median sale price was $1.05M, an increase of +5% from one year ago due to a sales jump in new luxury units while Jonathan Miller, president of Miller Samuel Appraisersand author of the latest Douglas Ellimanreport, called starter and resale markets “anemic.”
Brooklyn and Queens, like suburbs surrounding major metros in the early pandemic months, have been major beneficiaries of buyers who have less reason to be in Midtown for work. According to Kristina Leonetti, an agent withCompass,increasing bidding wars in Brooklyn “…felt like something from 2006. We didn’t expect this response.”
Garrett Derderian, director of market intelligence with Serhant,agreed. “…we saw heightened activity in Brooklyn in the $500,000 to $2M range and, not coincidentally, that’s where we saw reduced activity in Manhattan in the fourth quarter.” The price range of $500,000 to $2M simply buys more space both indoors and outdoors in Brooklyn than in Manhattan. The same is true in Queens.
Derderian believes that “2021 is the year of the great reset.” He thinks that sale prices in Manhattan will stabilize in 2021 and that prices in Brooklyn may continue to rise slightly.
In a new report from StreetEasy,8 of 10 neighborhoods to watch in 2021(based upon user traffic, sales and rental prices) will be in Brooklyn. Some of StreetEasy’stop markets include Brooklyn’s Greenpoint, Prospect Lefferts Gardens, Flatbush and Greenwood. StreetEasy, like other prognosticators, points to housing consumer aphrodisiacs such as near record mortgage interest rates, less consideration of commuting time due to remote work making commutes mute points and relatively affordable prices attracting long-time Manhattan renters opting for homeownership in Brooklyn.
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TheDouglass Elliman report underlined the-17.3% drop in rental prices Manhattan with a median of $2,800/month, the lowest since the last recession. Discounts in rental prices ranging from -11% to nearly -18%, as we reported last week, also extended beyond Manhattan.
Thanks to the New York Times.
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