“Brownstone Brooklyn” sees resurgence, condo

TRD New York /
Oct.October 15, 2010 07:30 AM

Brooklyn third-quarter home sales steady overall

Michael Guerra

Brownstone Brooklyn” showed tremendous strides in the third quarter, according to a market report released today by Prudential Douglas Elliman, reflecting a resurgence of demand for higher-end inventory in the borough.

That category, loosely defined as one-to-three-family homes in northwest Brooklyn, saw 121 sales last quarter, marking the first time in three years that more than 100 brownstone Brooklyn homes sold in a single quarter, according to the report’s author Jonathan Miller, an appraiser and head of Miller Samuel.

“Effectively, sales activity doubled in the course of a year,” in Brownstone Brooklyn, Miller said, noting that the average sales price climbed to $1.51 million in the third quarter, up 8.2 percent from the previous quarter and up 1.5 percent from the same time a year earlier.

Overall, Brooklyn residential sales activity and prices held steady during the third quarter, despite concerns that the aftermath of the first-time homebuyer tax credit would lead to declines.

The number of homes sold reached 1,879, dropping 2.7 percent from the second quarter, when the homebuyer tax credit artificially propelled sales. The number of sales was up 1.7 percent from third-quarter 2009.

The average sales price, meanwhile, showed gains, climbing 7.1 percent quarter-over-quarter and 7.2 percent year-over-year to $583,790.

“Overall [there was] stabilization, [and] not much of a ripple effect from the tax credit, although it’s certainly played a role and we might see more impact from it next quarter,” Miller said.

Michael Guerra, Elliman’s director of sales for Brooklyn, said that the quarter’s stability was a relief.

“It’s reassuring and almost surprising, the level of stability,” Guerra said.

But, Guerra noted, he’s keeping his eyes peeled for potential problems in the market.

“What [I was] focused on and concerned about was a negative impact from the tax incentive,” in the past, Guerra said. “Now, moving forward, I’m keeping my eye on the condo market.”

This quarter, condos, which are also included in the overall sales figures, showed a significant amount of volatility. The number of units sold — 549 — was down 17.9 percent from the previous quarter, but up 18.6 percent from the same quarter a year earlier. The average sales price climbed 4.8 percent quarter-over-quarter and 8.4 percent year-over-year, up to $591,015.

Guerra said that while it’s too soon to think of condos as a problem for Brooklyn, he has noticed some consistent “small, quiet, negative statistics” in north Brooklyn, where he says that kind of inventory plays a major role. The average condo sales price in north Brooklyn, which Elliman considers the Williamsburg and Greenpoint neighborhoods, declined 5.4 percent from the second quarter to $594,268.

“They’re showing a lurch that’s slightly negative, but their markets are driven largely by new construction,” Guerra said. “Is it just a 90-day aberrant period, or is that market dealing with unique characteristics? That could be a factor of ‘I don’t have a lot to close’ or it could be a trend.”

Miller noted that resales have taken up more of a market share, which could account for the weaker numbers in condos.

“New development stayed steady in terms of closing activity,” Miller said,” [but] we have a lot more resales now.”

Brooklyn Report


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