Here I track inflation-adjusted median sales price for all of Manhattan and all of Brooklyn to show some sort of Manhattan-to-Brooklyn discount relationship between the two boroughs. Yes this is a bit simplistic and fraught with problems such as the impact of new development and regions with more in property types and sizes. I wanted to show how the two markets behaved relative to each other during the gyrations of the boom.
Over the recent housing boom, part of the reason for Brooklyn’s success (aside from it being a great place to live!) was the value proposition to consumers in choosing between Manhattan and Brooklyn. As prices in Manhattan began to outstrip affordability in 2004, Brooklyn became even more attractive, value-wise.
In 2005 and 2006, the discount began to compress as Brooklyn boomed and peaked.
In 2007, Manhattan saw significant delivery of new product to the market and the upward climb in prices made Brooklyn more affordable relative to Manhattan with the peak discount occurring in the second quarter of 2008.
By 2009, the credit crunch began to turn the price relationship between the boroughs back to pre-housing boom (before 2004) levels.
Remember that this is Curbed, not the New England Journal of Medicine, but I think this shows the relationship (not price) is getting back to normal.
· Manhattan to Brooklyn Discount (comparison of inflation adjusted median sales price) [Miller Samuel]
· Three Cents Worth [Curbed]