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Q4 Brooklyn Reports Show Bloodletting, Except Brownstones

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There is much to unsettle the stomach in the Brooklyn Q4 report released by Prudential Douglas Elliman today. Words like scary and dismal come to mind, especially when it comes to sales figures compiled by Jonathan Miller of Miller Samuel. The really bad news is that sales fell 42.7 per cent in the Q4 to 1,846 from 3,222 in Q4 2007. In markets like North Brooklyn where thousands of units are coming on the market in the next 12 months, this should be enough to unsettle the stomachs of many developers and lenders. Median prices, meanwhile, fell 7.5 percent, to $490K from $530K in the same quarter last year. Average prices dropped 5.2 percent. Median sale prices in the "luxury" market took a 6.2 percent nosedive. Interestingly, median sales prices in North Brooklyn increased 3.7 percent while median prices in South Brooklyn took a 10.6 percent fall from the roof. East Brooklyn median prices plummeted 15.2 per cent and Northwest Brookyn (which we assume includes Williamsburg) dropped 8.9 percent. The number of sales there plummeted 42 per cent to 396.

The good news: housing stock in brownstone Brooklyn is holding its own. The report found that median sales prices of homes increased 12 percent from $1.115 million to $1.287 million. So, owners and buyers in Brooklyn Heights, Cobble Hill, Boerum Hill and Park Slope have less reason to run out and buy Pepto Bismal. Mr. Miller calls brownstones, right now, "a relative anomaly in the market," meaning that no one should forget where the Rite Aid or CVS is located. There is one other word when considering news that is good: "coop." Coop prices are holding up much better than condos. While median condo sales prices fell 4.7 percent, median sales prices of coops went up 2.9 percent, although again on the dark side, sales volume plummet a gut wrenching 32 percent from Q4 2007 to Q4 2008.

Corcoran has also released its year end report and the results are somewhat at odds with the early bloodletting reported by Mr. Miller. Cocoran reported an overall median increase in Brooklyn prices of 2 percent from 2007 to $580,000. Per Corcoran:

In 2008, median co-op sale price was up 7%. Similar to 2007, co-op median price increased in all size categories, ranging from a 2% increase for studios to an 18% increase for three-bedroom residences or larger. Meanwhile, median condo price was down in every size category, for an overall decrease of 5%. However, because there were more sales of smaller, more efficient units this year, average price per square foot still went up slightly while absolute prices fell. In the townhouse market, the median price for a single-family unit increased 6%, while the median price for a 2-4 family townhouse increased substantially by 34%.Corcoran, by the way, found median condo prices in Williamsburg down 13 pecent. The most interesting overall trend in the report is that it found condo prices down 5 percent while coop prices increased 7 percent. So, one thing that both reports can agree on is that the coop market is holding up better than condos.
· 4Q 08 Prudential Douglas Elliman Brooklyn Market Overview [elliman.com]
· Corcoran Brooklyn Year End Report (WARNING: PDF) [corcoran.com]