Things are looking up in the Brooklyn residential market, according to Gerard Longo, president of the Brooklyn New York Multiple Listing Service.

The MLS’ first-quarter 2010 report, which culls data from the listings registered in the MLS, shows that inventory dropped 22.7 percent year-over-year in the first quarter, while sales volume increased 10.08 percent to $181.67 million in the first three months of this year from $165.04 million in the first quarter of 2009.

While the median price dropped 7.02 percent during that same time period, the average price only declined .66 percent.

“I think we found a stable place in our market,” said Longo, who is also a principal with development firm Atlantic Walk Vestry and president of Brooklyn-based real estate company Madison Estates & Properties. “I think we’re flatlining here.” [more]

While the $959,000 asking price for 1 Maspeth Avenue — a 2,400-square-foot house in Williamsburg — might seem reasonable on the surface, Curbed has discovered a rare detail that has left it languishing on the market: its floorplan renders it virtually unusable. The home’s triangular layout makes it a prismatic head-scratcher for furniture layout, according to a tipster, and it has the price cuts to prove it. Although it was originally listed by Prudential Douglas Elliman for $1.2 million last November, it’s current asking price puts its price-per-square-foot at $399.

After his company nabbed two defaulted loans in Williamsburg, Peter Hauspurg, chairman and CEO of Eastern Consolidated, said he thinks the neighborhood might be ripe for distressed asset opportunities. In a recent interview with the Observer, Hauspurg talked about working with his wife, Daun Paris, president of Eastern Consolidated, and not doing his own taxes. He also said Williamsburg “probably has the greatest concentration of troubled real estate projects around.” Williamsburg’s popularity during the boom years likely contributed to its current woes, Hauspurg said, noting that “irrational exuberance” may have been partially to blame. “Everybody went there at the same time,” Hauspurg said. “The banks gave [developers] the money, they put up the structures and there just weren’t enough buyers.”

While neighborhoods that had once been considered emerging markets — Harlem, Long Island City and Williamsburg — took a beating in the recession, some insiders say that they’re becoming tepidly optimistic that things are turning around. “We’re seeing some encouraging signs of stabilization,” Jonathan Miller, appraiser and president of Miller Samuel, said. Even so, he added, “it’s too early to say the worst is over in the emerging neighborhoods.” Harlem, for instance, had five stalled developments last year, while Long Island City was saddled with seven. Williamsburg, meanwhile, has seen slashed prices across the board — in some cases by 33 percent or more — as developers and brokers try to unload pent up inventory.

From the February issue: The mini residential boom that brewed in Astoria, Queens, over the last
few years is now jockeying to find its recession-era footing.
The downturn has triggered double-digit discounts on the new upscale rentals and condos clustered in the area.
It has also halted some ambitious luxury residential projects in
the area, such as the Piano Factory, a 69-unit condo conversion on
Vernon Boulevard where sales were suspended last month.
In total, an estimated 25 new projects have either been completed in the last few years or remain in the construction phase. Among the biggest are the Piano Factory and East River Tower, a 74-unit new condo that came on the market in December.

From left: 360 Smith Street, 73 Pineapple Street, 303 East 51st Street, Beekman Tower and 189 Schermerhorn Street

From the February issue:Hundreds of dormant construction sites still dot the city, but a
handful of these beleaguered projects are finally seeing new life –
even if it’s not what was once dreamed of for the location. Those that
have seen some type of resolution were able to do so by selling off
their debt at steep discounts, slimming their construction costs or
setting their sights way lower.
This month, The Real Deal tracked down 20 stalled projects
that have seen some type of resolution within the past several months
(see chart after the jump).  [more] [more]

From left: Twins Andrew and Kenneth Herzberg of Sirius

The depressed market for new condominium apartments is driving the creation of new incentives to facilitate the sale of distressed units. To that end, developers have been trying mortgage payment guarantees and buyback guarantees, with little indication of success. Toll Brothers, developer of Northside Piers in Williamsburg, offered a mortgage protection plan at the condo, but scrapped it last summer. And a little over a year ago, in December 2008, condo developer Rockrose Development, which has split into Rockrose and TF Cornerstone, said it would give 20 buyers at the View in Long Island City the right to sell their unit back in five years to the developer at the original sales price. It was not clear if that had any impact. Now a new financial firm based in Manhattan is setting its sights on a national price protection program, but some industry experts are uncertain about its chances for success in New York City. The company, Sirius Value Protection, headed by identical twins Andrew and Kenneth Herzberg, is talking with developers about its program that offers a qualified price guarantee to buyers, Andrew, a co-managing partner, told The Real Deal. [more]

737 Drew Street

From the January issue: Minority and working-class Brooklyn neighborhoods like Bed-Stuy,
Canarsie and East New York have been suffering from high concentrations
of foreclosures since before 2007.
But recent statistics indicate that distress is creeping into
gentrified neighborhoods like Williamsburg, Greenpoint, Fort Greene and
Brooklyn Heights now, too. The Williamsburg-Greenpoint area saw a 141 percent quarterly
increase in foreclosure filings during the first three quarters of 2009
compared to 2008, while Fort Greene and Brooklyn Heights saw a 71
percent jump. Brooklyn-based appraiser Sam Heskel counted 99 distressed real
estate listings in Williamsburg, including 44 condominiums that are in
“pre-foreclosure.”

In their first official response to the bankruptcy filing of 20 Bayard, lawyers for W Financial Fund last week urged a U.S. Bankruptcy Court judge to reject a motion by developer Isaac Hager to continue operating the Williamsburg condominium with monthly rent and parking fees. Hager, president of North Development Group, threw the 64-unit condo into bankruptcy last month, when he was unable to make a $170,000 interest payment to W Financial, or refinance a $17.4 million bridge loan. In a Dec. 9 filing, Martin Ehrenfeld, restructuring officer for the developer, asked permission to use the rent and parking fees to cover monthly maintenance charges for at least 120 days until a reorganization plan is worked out with creditors. After selling 24 apartments before the real estate market collapsed in 2008, Hager rented out nearly all of the remaining units until the condo market recovered. According to the court documents, 20 Bayard has $1.28 million in net operating income per year. [more]

Steve Kliegerman, executive director of development marketing at Halstead Property, and Central Park Plaza at 1851 Adam Clayton Powell Boulevard in Harlem, which just gained FHA approval today

A temporary move to ease lending standards by the Federal Housing Administration has fueled hopes of a turnaround in New York’s residential housing market, as condominium developers have struggled to get financing for new buyers and fill thousands of unsold units.

Earlier this month, the agency announced that starting Dec. 7, it will lower the FHA pre-sale requirements for new condo buildings to 30 percent from 50 percent. In addition, the FHA will guarantee loans for 50 percent of a condo building’s units if the project meets strict underwriting standards.

“It completely changes the face of the New York City real estate market,” said Gary Goldman, president of National Condo Advisors, a Westchester-based firm that helps developers qualify for end-loan financing. “Now all these new construction buildings have a shot at getting some units closed.” [more]