Residential market report

From slumping sales in FiDi to Bed-Stuy’s new dev boom, a look at the biggest trends
By Meenal Vamburkar | May 01, 2019 01:00PM

Manhattan’s ‘polarized’ market rocks resi developers

As new development sales continue to struggle, Manhattan resales are getting a boost. The overall number of sales that closed in the first quarter fell 2.7 percent when compared with the same time in 2018, while the median sales price fell 0.2 percent, according to data from Douglas Elliman. Among new development properties, sales volume tumbled a whopping 39.4 percent, although the median price ticked up 3.4 percent. Elliman’s report found that new development closings had the lowest market share in four-and-a-half years. “The market’s essentially been consistent with a steady erosion of sales volume,” said Jonathan Miller, author of the Elliman report and CEO of appraisal firm Miller Samuel. In the resale market, the number of closed sales rose 2.2 percent year-over-year, as the median sales price grew 3.4 percent, to $997,750. The latter was a new record and represented the eighth straight quarterly increase. Miller said the Manhattan market is “polarized,” largely due to differing inventory trends in new development versus resales, where units don’t typically come to the market in bulk.

New dev sales are climbing in Bed-Stuy

With 27.5 percent of sales during the first quarter, Bedford-Stuyvesant was the top Brooklyn neighborhood for new developments, according to a report from brokerage MNS, which noted that 44 out of 160 total sponsor unit sales took place in the neighborhood. But the broader new development market in Brooklyn is shrinking. The borough’s median sales price dipped 19.6 percent year-over-year, to $1.1 million. The highest-priced sale was a unit at 200 Water Street in Dumbo, which sold for $5.1 million, or $1,795 per square foot. The Brooklyn neighborhood that experienced the largest quarterly downswing was Bushwick, where the price per square foot slid from $966 late last year to $781, per MNS data. The largest quarterly upswing was in Fort Greene, where the price per square foot increased from $882 to $1,327. The sizable shift in the area stems from the low number of sponsor sale closings quarter-over-quarter in Fort Greene, which can create large fluctuations in price, according to MNS. The Real Deal reported in April on a Fort Greene development site hitting the market seeking $65 million.

FiDi sales are still falling

The gap between buyers and sellers in the Financial District is getting wider. The median closing price of homes in FiDi during the first quarter was 4.7 percent lower than asking, according to a market report from the brokerage Platinum Properties. The median price plunged 14.5 percent during the first three months of 2019, to $1.01 million. A year earlier, similar units in the neighborhood closed at a 4.1 percent premium. Despite the downturn, there could be some cause for optimism. Although sales slipped 16 percent year-over-year in the first quarter, the drop-off was an improvement from the previous quarter’s 39 percent decline. The nearby Downtown neighborhood of Battery Park City also struggled with sales volume, which fell 11 percent when compared to the same time period last year. The median price, however, jumped 40 percent in Battery Park City, to $1.5 million. Platinum Properties’ report noted that the increase was driven by two-bedroom units, which saw a 26 percent spike in the median price, while three-bedroom unit prices tumbled 36 percent.

Buyers in Brooklyn, Queens stay on the sidelines

A quarterly Elliman market report looking at Brooklyn and Queens found falling sales prices and rising inventory, in line with similar trends in Manhattan. Nonetheless, the number of new leases being signed in both outer boroughs was up to start 2019, suggesting that for the time being potential buyers are staying put in the rental market. “When the sales market dips, the rental market is up,” said Elliman’s New York City president and CEO, Steven James. “The buyer is still waiting for better deals.” Sales volume continued to drop in Brooklyn, falling year-over-year for the fifth consecutive quarter, according to Elliman. Meanwhile, listing inventory in Brooklyn jumped 56.8 percent, to 3,203. Sales prices, which had been hitting record highs since the end of 2017, were slightly down. Brooklyn’s median sales price fell 3.8 percent, to $765,000. But luxury properties saw their median sales price rise 3.1 percent, to $2.5 million. The same patterns were visible in Queens, albeit on a smaller scale. The borough’s median sales price stayed flat, at $550,000, as luxury properties saw their median sales price rise 2.3 percent, to a record $1.34 million.