[This week, real estate appraiser, Curbed graph guru, blogger, and podcaster Jonathan Miller minds the Manhattan-Brooklyn gap.]
After last week's release of our rental report for Manhattan and Brooklyn and with all the talk about the gap between the boroughs closing, I thought I'd revisit the topic and add the sales market to the rental mix.
Methodology: It's a bit wonky but I looked at the median price for sales and rentals as a way to reduce the skew from outliers. The columns of each chart represent the difference in price between the two boroughs. I color coded the same period in prior years to more clearly present the trend since post-Lehman tipping point. I don't compile sales data by month but I do for rentals so I made sure the time frame was in sync between the property types. It's important to note that the Brooklyn rental data we track only includes the north and northwest regions of Brooklyn?the remaining borough data we have is too thin at this time?yet the Manhattan rental data is borough wide.
Here are some thoughts for each category:
Rentals: There is a lot of volatility but the spread in rents between the two boroughs is narrowing. While the two boroughs are moving closer together, the difference is less than if we were tracking all of Brooklyn. Brooklyn m-o-m rental prices are trending higher as Manhattan price growth (m-o-m) has been relatively stable over the past year.
Sales: Like the rental market, the sales price spread has been narrowing. Brooklyn prices are trending higher while Manhattan is relatively stable with more clearly defined seasonal price trends.
Brooklyn prices are doing the heavy lifting over Manhattan prices in the race for price parity between the two boroughs. While I don't expect Brooklyn to exceed Manhattan price levels for sales and rentals anytime soon, I do think the gap will continue to narrow over the coming years.
· Matrix [matrix.millersamuel.com]
· Three Cents Worth archive [Curbed]