Despite Record-Breaking Deals, Brooklyn Home Sales Fall Amid Market-Wide Slowdown

 

BROOKLYN, N.Y., Jan. 10, 2019 /NYI/ -- Stribling & Associates, a leading New York residential brokerage, today releases the fourth quarter Brooklyn Market Report. The report is the only to cover inventory, contracts and sales across the entire borough. It highlighted a decline in the number of sales amid increased discounts, but a slight increase in contract activity. Inventory across the borough also increased, mirroring a similar trend in Manhattan.

"Price growth in Brooklyn has definitely slowed," said Garrett Derderian, Director of Data & Reporting at Stribling. "While the number of sales was down 7%, contract activity was up 2%, a promising sign sellers are adjusting prices to meet the market. On a high-level, East and South Brooklyn are where we still see sustained price growth, while the costlier markets closer to Manhattan have stalled."

The report, which divides Brooklyn into four major submarkets, noted North Brooklyn, encompassing the greater Williamsburg area, was the only submarket to record substantial price declines across all metrics, with the L-Train shutdown - which was recently halted - contributing to the slowdown in sales.

As the report indicates, North Brooklyn has been recording price declines outpacing the rest of the borough for several quarters. However, the lower valuations also presents a potential buying opportunity in an otherwise healthy market. The average discount, at 8%, is the highest in Brooklyn.

"With the recent news the L-Train is no longer going to have a complete shutdown, expect to see shift in the North Brooklyn market in upcoming quarters. Not to say this is suddenly a sellers' market, but the discounts should fall more in line with the rest of the borough," Derderian said.

According to the report, houses and townhouses were the only property type to record yearly price increases. The median home price increased 10% to $920,000 and the average price increased 7% to $1,120,696. The average price-per-foot was up an accompanying 13% to $571.  These properties also had the greatest discounts, averaging 8%, double that of condos at 4%.

The top five sales in the borough were all in Brooklyn Heights, a small neighborhood in the Northwest Brooklyn submarket. While the overall market down, the super-prime market is still breaking records. A penthouse condo in Brooklyn Heights sold at the end of the quarter for $16,745,121, a new record.

That record, too, might soon be broken. It was reported that a penthouse condo at the Quay Tower, a new development condo building also in Brooklyn Heights, sold for a reported $20 million. However, that deal has yet to close so the final sales price remains unknown.

Still, Derderian pointed to concern surrounding the supply of active listings. "The number of homes for sale, particularly among condos, has been steadily increasing. Condos were the only inventory type to see both their median and average prices decline. They also had the smallest average price-per-foot appreciation," he said.

In the coming months, the sheer number of units that will become available will put pressure on prices. "Ultimately, it comes down to the basic economics of supply and demand. With a considerable number of units in the pipeline, we are bound to see continued negotiability and incentives," Derderian explained.

Highlights from Stribling & Associates Q4 Brooklyn Market Report:

-          Median sales price was $790,000, up 1% year-over-year
-          Average sales price was $986,885, up 2% year-over-year
-          Average price per square foot was $747, down 10% year-over-year
-          Average days on market was 116, up from 86 one year ago
-          There are 7.8 months of supply, up from 6.9 one year ago
-          Market-wide average discount from initial ask was 5.6%

Recorded Sales:

-          There were 2,108 recorded sales to date, down 7% from one year ago
-          Condo units saw an average PPSF of $1,069
-          Townhouses/houses had the highest median price, at $920,000
-          Co-op units had a median price of $462,750
-          Properties sold between $500K-1M made up 47% of all closings
-          6% of closings were priced above $2M
-          Northwest Brooklyn has the highest median and average prices, at $1,100,000 and $1,427,458, respectively
-          The smallest discounts were in Northwest Brooklyn, averaging 5%
-          North Brooklyn had the greatest discounts, averaging 8%

Contracts Signed:

-          There were 1,578 contracts signed, up 2% from one year ago
-          Condos made up 39% of all contracts
-          Condos recorded the highest average PPSF at $1,093
-          Townhouses/houses has the highest median price at $1,200,000
-          Units priced above $3M saw the median price decrease of 7% and average decrease of 11%
-          Northwest saw the greatest price improvements, with the median up 10% and average up 4%
-          South Brooklyn and Northwest Brooklyn recorded the most contracts, with 37% each
-          North Brooklyn recorded the least contracts, with 11%

Inventory:

-          There were 4,358 active units in the borough, a 12% increase year-over-year
-          Condos made up 33% of inventory
-          Condo units had the highest average PPSF at $1,055
-          Co-op units were the most affordable, with an average PPSF of $626
-          This was the lowest level of inventory priced below $500K, at 13%
-          36% of inventory was priced between $500K-1M
-          All submarkets had average asking prices above $1 million
-          North Brooklyn was the only submarket to record a price-per-foot decline, down 5%
-          South Brooklyn saw the greatest median price increase, up 5% to $839,000
-          East Brooklyn saw the greatest average price-per-foot increase, up 16% to $686

About Stribling & Associates

Stribling & Associates, Ltd. is a premier residential real estate firm with over 300 agents throughout five locations across Manhattan, Brooklyn, and Long Island City. As one of the most renowned brokerages in New York, Stribling uses its respected expertise in the current market to provide individualized services to both buyer and sellers. Stribling agents specialize in the sale of luxury townhouses and cooperative and condominium apartments. The company's philosophy is based on professional, personalized services coupled with exceptional knowledge of key residential market trends. Stribling Private Brokerage specializes in the discreet marketing of properties over $5 million and commands a prominent market share in that sector of Manhattan residential real estate. Through strategic partnerships with Miami's Cervera and international estate services firm Savills, Stribling's global reach extends to more than 700 offices worldwide.