The average Brooklyn pad cost nearly $860,000 during the third quarter – setting yet another price record and quashing any lingering notion of the borough’s affordability, according to Douglas Elliman’s latest quarterly sales report.
While the average price rose 18 percent year over year, the median price jumped 15.1 percent to $676,250 – another record high – according to the report.
The pace of sales was also the fastest in eight years: The number of sales jumped 14 percent to 2,368 while the number of days on market dropped 40 percent to 55 days.
“It’s being driven by the cast of characters: steady rising sales activity, combined with flat supply within a city with a robust economy and rising employment,” said Jonathan Miller, president of real estate appraisal firm Miller Samuel and author of the report.
Another key driver is the supply of luxury product that’s being developed. “You throw those things together and you have prices rising,” he said.
Brooklyn is the only borough where median prices are higher than they were before the Lehman Brothers collapse. The median price in Brooklyn during the quarter was 25 percent higher than the $540,000 mark reached eight years ago.
In Queens, the number of sales increased 64.6 percent to 3,642 while the median sales price jumped more than 14 percent to a record $450,865, according to the Douglas Elliman report.
Despite robust development activity, Miller attributed the sales volume – and price growth – to demand that’s spilled over from Manhattan and Brooklyn. “In many ways, it’s like Brooklyn used to be. They were priced out of Manhattan, they went to Brooklyn,” he said. “Now they’re coming to Queens.”
Sales over $1 million accounted for 24 percent of closed sales during the third quarter, up from just 4 percent of closed sales in 2010, according to the Corcoran Group’s own report, also published today.
Multi-family properties, a category that includes many brownstones, increased a whopping 38 percent to $1.86 million, compared with $1.34 million last year. “It has just rocked this market,” said Frank Percesepe, the firm’s regional senior vice president in Brooklyn, who said demand was pushing prices higher. “People want to own a piece of property and Brooklyn is the perfect place to come for housing stock,” he said.
For new developments, the average sales price rose 19 percent to $1.01 million during the third quarter, according to Corcoran. “I can tell you, the end is not in sight,” Percesepe said.
September rental redux
The rental market posted similar price gains in September, according to a separate report from Douglas Elliman also published today.
In Manhattan, the median rental price increased for the 19th consecutive month, jumping 5.4 percent to $3,437 in September – the highest since the financial crisis. Meanwhile, the number of new rentals slipped 21.8 percent to 3,478, and the vacancy rate increase to 2.69 percent from 1.76 percent.
In Brooklyn, the median rental price rose 7.7 percent to $2,953 — $484 less than Manhattan. The number of new rentals fell 19.3 percent to 594.
Queens’ median rental price jumped 18.4 percent to $2,964. And the borough — where new development has a 25 percent market share – also saw the number of new rentals increase 14.6 percent to 244 as listing inventory shot up 119.8 percent to 400.
“Usually September is not as busy as August, but we still saw growth,” said Luciane Serifovic, Douglas Elliman’s executive manager of rentals, who said the Jewish holidays that fell out in mid- and late September extended the busy summer rental season.
In Brooklyn, she noted that prices aren’t showing signs of slowing. “We’re seeing the prices get closer and closer to Manhattan,” she said. “People want to live there.”