Douglas Elliman released its quarterly report today on home sales in Brooklyn and Queens, and the news looks daunting for prospective buyers: Sales prices rose and inventory fell in both boroughs, in some instances breaking years-long records.
Jonathan Miller, head of appraisal firm Miller Samuel and the author of the report, notes that the fast-moving markets in Brooklyn and Queens are part of a larger ecosystem: "Spillover from Brooklyn to Queens is driving up sales in Queens," he says, "and Brooklyn itself has become its own entity, as opposed to being a cheaper alternative to Manhattan."
Compared to this time last year, the median sales price on units in Brooklyn jumped 8.9 percent to $659,000; meanwhile, listing inventory declined by 37.4 percent. The fall in supply has created a faster absorption rate, which Miller explains is the theoretical number of months it would take to sell all available inventory at the current rate of sales activity. The report reveals that Brooklyn's current absorption rate is 4.2 months, the quickest it's been in almost decade.
The changes afoot in Queens' sales market are even more dramatic: The average sales price jumped to $526,943, the highest in 13 years, while the median sales price saw a 20.8 percent increase to $465,000. And the borough's absorption rate has sped up significantly, to 5.1 months. "The past 40 quarters, the average absorption rate was 10 months, so now it feels like the market is moving 50 percent faster than it did historically," Miller says. "That is the backdrop to why you're seeing rising prices on a year over year basis."
So what are the long-term implications of such rapidly-moving markets? Miller doesn't foresee the pace letting up much: "The city economy is very strong. We have rapid employment growth and the population growth is five years ahead of trends, so the basis for demand is strong."
Miller says to expect a possible shift in attention to the Bronx, as Queens ceases to be a sleepier, more affordable corner of the city. More New Yorkers may also head to the suburbs in search of cheaper alternatives. "As affordability continues to be under siege, consumers continue to consider their options," he says. "This is one of the reasons we’ve been seeing multi-decade record sales volume in the outlying suburbs. There doesn’t seem to be much relief in sight."
With that in mind, here are some options currently listed at the median price points for Queens and Brooklyn--though it sounds like that could change soon.
35-24 78th Street: This garden level co-op, listed for $408,000, is on a quiet, historic block in the otherwise bustling neighborhood of Jackson Heights, and has views of a private interior garden. There are separate living and dining rooms, an eat-in kitchen, and a dressing room leading into the spacious bedroom.
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