Brownstone Brooklyn siphoning demand from Manhattan, Williamsburg

StreetEasy names Lower East Side, Hell’s Kitchen, Yorkville among city’s top buyer’s markets

(Photo Illustration by The Real Deal with Getty)
(Photo Illustration by The Real Deal with Getty)

There comes a time in every younger brother or sister’s life when they finally pull one over on their older sibling. That moment may have arrived for Brooklyn’s real estate market. 

Demand for homes in the borough — long viewed as Manhattan’s cheaper alternative — has grown so strong that it’s created a buyer’s market in several neighborhoods across the East River, a report from StreetEasy indicates.

The Lower East Side and Hell’s Kitchen are among the city’s 10 best buyer’s markets, according to the listings site, in part due to high mortgage rates harming demand, but also thanks to wealthy buyers shifting their attention to Brownstone Brooklyn.

“This shift opens up a major opportunity for would-be buyers to secure a deal in traditionally sought-after Manhattan neighborhoods,” states the report, which examined neighborhoods with at least 90 listings in at least 30 buildings.

More than a quarter of all listings on the Lower East Side, 28 percent, dropped their asking prices during the fourth quarter of last year, according to StreetEasy’s analysis. That’s an increase of 10 percentage points over the fourth quarter of 2021.

Listings in Yorkville lowered their asks at an even greater rate, 31 percent, up 11 percentage points from a year earlier, and 23 percent of Hell’s Kitchen listings saw cuts, a 7 point increase. 

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Within Brooklyn, Williamsburg also appears to be facing stiffer competition. More than a fifth of all listings there, or 21 percent, reduced their asks last quarter. StreetEasy’s analysis found that aggressive pandemic pricing in the area “went too far,” prompting buyers to look elsewhere. 

The report notes that “a spike in new development listings” in Dumbo, Downtown Brooklyn, Crown Heights and nearby Greenpoint has siphoned demand from Williamsburg just as it has from Manhattan.

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StreetEasy anticipates that the market may become even more favorable for buyers as the year progresses.

Mortgage rates will remain volatile this year, but as rates stabilize below last year’s record highs, more inventory will be unlocked for buyers,” the report predicted.