Both Manhattan and Brooklyn saw sustained growth in February compared to 2015 levels, but East Brooklyn surpassed all neighborhoods with a 20.5 percent rise in median asking price, says StreetEasy’s February market report.
The East Brooklyn submarket, comprised of Bedford-Stuyvesant, Brownsville, Bushwick, Crown Heights and East New York, is in the mid-range compared with costlier settings like Dumbo and Greenpoint. The median asking price in Crown Heights is $910,000, Bedford-Stuyvesant is $899,000 and Bushwick is $795,000. East New York is the lowest, with a median asking price of $370,000.
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“Affordability is primarily driving homebuyers to East Brooklyn and Upper Manhattan,” said StreetEasy data scientist Alan Lightfeldt. “New demand for housing in these parts of the city is a double-edged sword, however. As more buyers search for value in neighborhoods like Bedford-Stuyvesant and Central Harlem, we’re going to see prices increase. Heading into the spring buying season, prospective buyers should expect to encounter fierce competition for dwindling inventory in East Brooklyn and Upper Manhattan.”
Although recent demand is forecasted to tighten inventory in many markets, including East Brooklyn, both the Brooklyn and Manhattan for-sale markets demonstrated notable growth when rivaled against last February’s median prices.
Sales prices soar in submarkets
Brooklyn rose 6.9 percent overall between February 2015 and 2016, with East Brooklyn leading the borough’s mounting market. South Brooklyn trailed behind East Brooklyn with 9.4 percent growth, while Prospect Park, North Brooklyn and Northwest Brooklyn saw increases of 8.7 percent, 4.7 percent and 2.3 percent upturns, respectively.
The Manhattan market rose to a median $982,437 — a 4.4 percent increase from last year. On a submarket scale, Upper Manhattan showed the strongest growth since November 2014, with 10.4 percent yearly growth. The Upper West Side had 6.6 percent growth, followed by Downtown with 4.3 percent, Upper East Side with 3.6 percent and Midtown with 1.6 percent price increases.
Rents fail to pace in both boroughs
Rents in Manhattan grew a median 3.3 percent annually to reach $3,114 in February, with the Upper West Side seeing the highest increase at 4.4 percent. Midtown followed closely with 4.3 percent growth since last year.
Although the Upper East Side reached a 4 percent annual hike in rent, the median has dropped month-over-month since November 2015.
Upper Manhattan had a 2.7 percent annual increase, while Downtown experienced just a 2.2 percent annual increase. Both markets have also seen consecutive monthly price drops since September 2015.
In Brooklyn, median rent growth did not ascend as high as sales prices — and in some neighborhoods, it dropped. Overall, Brooklyn grew just 0.8 percent year-over-year to reach a median rent price of $2,607 per month. North Brooklyn lead the borough with 2.3 percent annual growth, while Northwest Brooklyn saw a 2.1 percent annual rise.
North and Northwest Brooklyn are located closer to Manhattan and traditionally fare better on the rental market than the other districts throughout the borough. Dumbo in Northwest Brooklyn was the most expensive rental market in Brooklyn last month for all apartment sizes, said MNS. The median asking price for rent in Dumbo is $3,998, according to StreetEasy data.
On the opposite end, South Brooklyn rents dropped 3.4 percent on a yearly basis. East Brooklyn median rent dropped 1.2 percent year-over-year, while Prospect Park fell a minimal 0.1 percent year-over-year.
Price growth over the next year
While East Brooklyn saw a surge, the report expects the Brooklyn market to cool in the next 12 months overall. Brooklyn resale prices are projected to grow 0.9 percent over the next year, according to StreetEasy, slowing most in the Prospect Park Region. Prospect Park encompasses Park Slope, Prospect Heights, Prospect Lefferts Gardens and Kensington.
StreetEasy anticipates Northwest Brooklyn to be hit the hardest – with a forecast of a 1.8 percent decrease in prices. Northwest Brooklyn covers Dumbo, Brooklyn Heights and Downtown Brooklyn.
In Manhattan, annual price growth is also expected to cool down 3.2 percent, according to StreetEasy. The largest decrease in growth is forecasted in Upper Manhattan, which is predicted to grow 5 percent over the next year, versus 10.4 percent growth seen over the last 12 months.
