The Big Apple’s home prices soured in January at the fastest annual rate on record, falling 5.4 percent in Brooklyn and 6.2 percent in Manhattan, according to data firm StreetEasy.
The price plunge drove sales higher compared with a year earlier. Brooklyn closed 17.3 percent more deals than a year earlier; Manhattan sales jumped 30.8 percent.
The sales pace in Brooklyn was 82 percent brisker in 2020’s fourth quarter than during the same period in 2019, a record pace made even more impressive by the fourth quarter’s history as the year’s slowest real estate market.
Brooklyn homes listed for sale were 14.1 percent more plentiful in January than the same month in 2020. Manhattan’s inventory was 24.7 percent higher year on year.
Because Brooklyn’s homes are cheaper per square foot than Manhattan’s, Brooklyn is becoming the city’s hottest housing market, StreetEasy economist Nancy Wu said to Business Insider.
In contrast, Manhattan’s home prices will continue to slide, she said, now that white-collar jobs can be done from home, enabling people to seek larger, cheaper digs elsewhere.
Also, other factors that predate the pandemic are weighing on the city’s real estate market: developers built too many luxury condos and the city instituted a “mansion tax,” Ms. Wu noted.
TREND FORECAST: These factors are likely to remain in place after the COVID War subsides and the broader economy recovers. As we have been long reporting, New York City, commercially and residentially has been overbuilt, with supply far greater than demand. Indeed, from uptown to downtown, east side, west side, the hottest sections were already plastered with commercial/retail “For Rent” signs.
And, as Ms. Wu notes, “There’s been a sales slowdown in the city for the past three years.” In Manhattan, and somewhat in Brooklyn, prices have been falling for a while now. With inventory levels as high they are, there is currently no end in sight when it comes to falling New York City real estate prices.
