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Rents In Brooklyn and Queens Fall Behind As Sales Prices Soar

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The Elliman reports for Brooklyn and Queens Q3 sales have arrived, and—surprise!—there's no reprieve to be found. That's right, prices continued to climb setting new records in both boroughs in more than one category. For starters, Brooklyn and Queens set new records for median and average sales price. Brooklyn's median sales price now dangles around $676,250, meaning that it's the only borough—Manhattan included—where the median sales price has exceeded its pre-Lehman high. Elliman market reports compiler Jonathan Miller chalks this up to Brooklyn's new post-recession identity as destination. Brooklyn's growing cachet isn't news to anyone who's been paying attention the last few years. But here's just how much things have changed for the borough: the median sales price in Brooklyn is now 25-percent above its pre-recession high in 2007. Neither Manhattan nor Queens sales prices have even caught up to their 2007 numbers yet.

That said, neither Queens nor Manhattan (which we canvased last week) is too far behind. The median sales price in Queens—comprised in Elliman data of LIC, Astoria, Woodside, and Sunnyside—is now $450,865, which is 14-percent more than it was at this time last year and only six percent less than its pre-Lehman high. Not only has Queens blasted its median and average sales records in Q3, but it's also set new records for one- through three-bedroom apartments, condos, co-ops, and luxury apartments. Talk about a hot quarter. To what can Queens owe all of its success? "We don't have fast and loose credit this time around," Miller says, "so if price [in Manhattan or Brooklyn] is too high there isn't some 'magic' your local mortgage broker can do to get you the financing you need." The consistent rising prices and crunch of inventory is putting more stress on Queens, driving prices higher.

The search for affordability also in part drove the median rent in Queens ($2,954) to outpace the median rent in Brooklyn ($2,953) in August—by all of $1. Although that sounds impressive, Miller says that happens about every four to five months, because the market in Queens is so volatile, yet consistently high.

It wasn't a blockbuster month for Brooklyn rents, but that doesn't mean they're not climbing. September was the sixth consecutive month that median rental prices were up year-over-year. Rents in the borough are down about five percent from August, but that can be attributed to nothing more than seasonal flux. But it wouldn't be Brooklyn if at least some new records weren't set: the median price for a one-bedroom of $2,896 is the highest it's been since 2008, and the median rental price in the north (Williamsburg, Greenpoint) and east (Crown Heights, East NY) regions of Brooklyn is peaking.

Although Brooklyn's gaining on Manhattan, Manhattan rents continue to dominate. September's median rent of $3,437 is the highest its been since the recession, trailing only behind the all-time record of $3,695 in February 2009. Year-over-year, the median rental price in Manhattan has now been on the rise for 19 consecutive months.

Other real estate firms also report similar numbers. Cocoran's Brooklyn Q3 sales market report says that the borough's median price of $623,000 is 28 percent above last year's figure, representing the highest annual median price gain since 2008, at least. Sales between $1 million and $2 million were accountable for 20 percent of sales in Brooklyn in Q3, and the sale of properties priced between $0 and $350,000 (a bleak sampling, this way) was down 12 percent from this time last year.

MNS also found that rental prices in Brooklyn were up in Williamsburg, Bushwick, and Bed-Stuy, but down in Crown Heights and Prospect-Lefferts Gardens (although nominally), where Elliman saw gains. This might be because of how the two firms crunch their numbers; Elliman uses median when MNS uses average. Whatever way they go about milking their stats, MNS also found that Manhattan's red hot. The map below can speak for itself.

TL;DR: Q3 brought new records for median and average sales prices in both Brooklyn and Queens. Brooklyn's median sales price is the only to exceed its pre-Lehman high (and by a whole 25 percent.) Sales market prices in Queens are trailing, but not by all that much. In September, Queens's median rent outpaced Brooklyn's by all of $1, which isn't all that uncommon. Manhattan's median rent in September of $3,437 is the highest its been since the recession (the all-time record is $3,695 in February 2009.)
· Brooklyn Q3 2015 Sales [Elliman]
· Queens Q3 2015 Sales [Elliman]
· Manhattan, Brooklyn, and Queens Rental Market Report - September 2015 [Elliman]
· Brooklyn Q3 Sales Report [Corcoran]
· Manhattan Rental Market Report September 2015 [MNS]
· Brooklyn Rental Market Report September 2015 [MNS]
· Queens Rental Market Report September 2015 [MNS]
· As Manhattan Prices Keep Climbing, Inventory Plummets [Curbed]
· Market Reports archives [Curbed]