Brooklyn condo market going strong in 1Q

By Adam Fusfeld | April 14, 2011 11:24PM

From left, Frank Percesepe of Corcoran and Michael Guerra of Elliman

Brooklyn condominium units were in high demand during the first quarter, according to Prudential Douglas Elliman and the Corcoran Group, with new developments powering the sales spike.

Condo sales soared 61.1 percent to 923 units, from 573 units in the same period last year, the Elliman first quarter market report, prepared by Miller Samuel, says. The median price jumped 1 percent from last quarter, and 7.2 percent from a year ago at the same time, Elliman determined.

“It looked like 2010 was setting this year up for a return to normalcy, and that’s exactly what we’ve found,” said Michael Guerra, director of sales for Elliman’s Brooklyn division.

New developments comprised 44 percent of the sales market in the first quarter of 2011, compared to 35 percent in fourth-quarter 2010, according to Corcoran’s market analysis, and the median sales price of new developments rose 13 percent to $525,000 from the fourth quarter of 2010.

“If someone builds it, people will buy it,” said Corcoran’s Regional Vice President for Brooklyn Frank Percesepe. And that extends to the resale market, too, where condos returning to the market saw a median price of $455,000, or 7 percent more than the previous quarter, and a sales volume increase of 71.7 percent from the last three months of 2010.

Percesepe was bullish on the market but said he was disappointed with the sales prices for townhouses. According to the report, the median sales price for single-family townhouses fell 3 percent from the same three months in 2010, and two-to-four family townhouses plummeted 28 percent. But Percesepe said a closer look at the numbers reveals declining prices because of a lack of good properties on the market.

Michael Guerra, director of sales for Elliman’s Brooklyn division also noted the weaker townhouse market and attributed the decline to “discretionary sellers,” who are willing to wait to see the value of their property continue to rise.

Both Guerra and Percesepe expressed concern over the lack of new residential projects being developed, saying it’s the one obstacle that the market faces. So many stalled projects were completed and hit, or are on the verge of hitting, the market that little else remains on the horizon. “Soon, we’re going to need more shovels in the ground,” Percesepe said.