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Brooklyn Sales Set Records; Manhattan Rents Hit 5-Year High

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It's no surprise that the Brooklyn property market is hot, hot, hot—and now there are more figures to back it up. (And, a nifty map!) First, this morning Douglas Elliman released its report on Brooklyn and Queens sales for the second quarter of 2014, and here's the takeaway: in Kings County, sales prices just set record highs. The median sales price rose 4.5 percent from Q2 2013 to $575,000, while the average sales price leapt 16.6 percent to $783,296. "Brooklyn is the only borough where the median sales price is higher than the pre-Lehman high [in the third quarter of 2007]," says report preparer and stats guru Jonathan Miller. "But that means it is a record because Brooklyn did not have higher prices earlier than that."

The luxury market fared especially well, with the median sales price jumping 29.6 percent year-over-year to $2,138,325—yep, that's another record. Inventory remains low, pushing prices up, but lest sellers get too bearish, Miller thinks this booming state of affairs may not last: "The pace of price gains are cooling, so this price growth may not be sustainable."

As for Queens, the borough is lagging behind Brooklyn and didn't set any records or anything in the second quarter of 2014. In fact, after six consecutive quarters of increases, the number of sales dipped below what it was this time last year. The median sales price dropped 9 percent to $355,000, while the average sales price decreased 6.1 percent to $414,640. What gives? "Queens was weaker than expected this quarter, but not clear if it is a trend," Miller said. "The decline in sales and prices probably had something to do with the unusual surge we saw in the same period last year. A year ago prices were highest since Lehman." So Queens watchers, take heart: year to date, the number of sales was still 14.2 percent higher than Q2 2013, so it's not as if activity in the borough is stagnating, heaven forbid.

Onto the rental market we go. Elliman also released its analysis of the rental market in Manhattan, Brooklyn, and (for the first time!) Queens for June 2014. The big news isn't in Brooklyn but rather in Manhattan: the median rent, $3,300, is at its highest point in more than five years, and it marks a 3.3 percent jump from June 2013. Prices have increased for the fourth consecutive month. That's probably due in part to the fact that the vacancy rate was the lowest last month than it's been for five years, meaning landlords had little reason to negotiate on rents or grant concessions. Little supply; lots of demand. Let's move over to Brooklyn.

The trend is also upward here, but not as much as Manhattan. In June, median rental prices increased 2.3 percent to $2,800. "While median rental prices have increased year over year for 13 consecutive months, rents have been fairly stable month-over-month in 2014," said Jonathan Miller of Brooklyn. "The spread between Manhattan and Brooklyn is holding at $500 after bottoming in February at $210." That's because Brooklyn's rents are leveling off (yay?) as Manhattan's are rising, rather than Manhattan's rents plateauing and Brooklyn's surging.

Onto the Queens rental market, which Elliman tackled for the first time this quarter. Note that the analysis only covers Long Island City, Woodside, Sunnyside and Astoria. An impressive 48.4 percent of Queens's rental market is new development, which is somewhat unsurprising given trends like LIC's insane residential building boom. So there's some supply there with more on the way, which is probably why median rental prices in June slipped a tiny bit year-over-year after four consecutive monthly increases. (It was a drop of half a percent from Q2 2013 to $2,830.) The dip might also have to do with more renters leasing smaller units, like one-bedrooms, which pulls down overall prices.

Let's jump back across the river for a moment: Citi Habitats also unveiled its review of both Q2 2014 and June rents, finding that in June, average Manhattan rents reached a new record, at $3,470. By $9, that topped the previous peak of $3,461 set in August 2012. Demand is high, so there were fewer vacancies and fewer concessions from landlords.

Brokerage MNS also released Brooklyn and Manhattan rental reports for June 2014. Taking more of a neighborhood-by-neighborhood approach, the key findings are as follows: in Manhattan, Harlem rents continue to rise, with the highest positive year-over-year change for the fifth consecutive month. Meanwhile, Tribeca's average rents actually decreased by a (relatively) hefty amount, due to an influx of lower priced non-doorman units that brought down the total. In Brooklyn, by MNS's measure, average rents increased compared with June of last year, rising from $2,556 to $2,741. That was driven largely by major hikes in gentrifying areas like Bay Ridge, Bed-Stuy, and Prospect-Lefferts Gardens—in fact, Crown Heights saw the largest increase in pricing this year relative to the rest of Brooklyn.

· 2Q - 2014 Brooklyn Sales [Elliman]
· 2Q - 2014 Queens Sales [Elliman]
· June - 2014 Manhattan And Brooklyn Rentals [Elliman]
· Market Reports [Citi Habitats]
· Manhattan Rental Report [MNS]
· Brooklyn Rental Report [MNS]
· Mapping Manhattan's and Brooklyn's Newest, Priciest Sales [Curbed]
· All Rental Market Reports coverage [Curbed]
· All Market Reports coverage [Curbed]