Queens beats Brooklyn in home sales volume, not prices

Queens and Brooklyn — which both got a significant boost from the
federal homebuyer tax credit — saw real estate sales jump in the
second quarter of 2010, according to a market report released today by Prudential Douglas Elliman.

In Queens, sales leaped a dramatic 86.6 percent to 3,972 sales in the
second quarter, up from 2,129 in the same quarter last year, according
to the quarterly report. In Brooklyn, Elliman tracked 1,660 sales, up
16.2 percent from the prior-year quarter.

Brooklyn bested Queens in prices, however. The average sales price of a
Brooklyn home was $545,110 in the second quarter, up 10.1 percent from
the same period of 2009, while the median price rose 5 percent to
$463,000.

In Queens, by contrast, prices trended downward, with the average sales
price dipping 3.6 percent from the prior-year quarter to $382,518, and
the median sales price dropping 7.5 percent to $335,000.

Queens “is a weaker picture than the Brooklyn market is,” said
appraiser Jonathan Miller, president and CEO of Miller Samuel and the
author of the report.

But as is often the case with market reports, the picture is more complicated than it first seems.

The drop in Queens prices is likely the result of more lower-priced,
resale apartments selling compared to last year at this time, when many
high-priced new development condos that had sold during the boom were
closing, Miller said. He noted that in the second quarter, 22.6 percent
of the condos that closed in Queens were in new developments. That’s
down from 49.3 percent in the same period of last year.

Sales of lower-priced resales, he said, were encouraged by the $8,000
federal homebuyer tax credit and because resales have been easier to
finance than new developments in the wake of the 2008 Lehman Brothers
collapse.

“There was just a lot more resale activity,” Miller said. “At a lower
price point, that speaks to the impact of the tax credit.”
Sales in Brooklyn were also encouraged by the homebuyer tax credit, he
said. But price increases were partially due to heightened activity in
the luxury market, which is recovering from the doldrums of the
immediate post-Lehman period, a similar pattern to what occurred in
Manhattan in the second quarter.

“Part of the increase is a return to normal levels of activity for
high-end properties,” he said, adding that spring tends to be a
particular strong time for real estate.

While the prices of some individual properties are rising slightly in
Brooklyn, he said it’s too early to tell if that’s a sustainable trend.

“I’d still say we are moving sideways,” he said. “We are seeing more
transactions that are showing some appreciation, but still the majority
of [prices] are flat.”

Michael Guerra, Elliman’s director of sales for Brooklyn, said open
houses are crowded in the borough and demand for appointments is up.
Still, it’s possible that the homebuyer tax credit created a temporary
uptick in activity.

“We will see if the trend continues post tax-break,” Guerra said. “If we do, that’s a very positive sign.”

In “Brownstone Brooklyn” — one- to three-family homes in Northwest
Brooklyn — the median sales prices rose 12.2 percent year-over-year to
$1.1 million. In the Williamsburg/Greenpoint market, the median sales
price was $585,000, up 10.2 percent from the prior-year-quarter.

In Northwest Queens, which includes Long Island City, the median sales
price was $455,692, down 5.3 percent from the second quarter of 2009.