CORCORAN MARKET SUMMARY
December was a very active month for sales in Brooklyn, with 382 contracts signed, the highest figure for the month of December in over 5 years and 18% higher than last December. Listed inventory rose 11% year-over-year, but dropped to the second lowest level since January 2016. Median sale price experienced double-digit gains over the last month, but experienced only a modest gain over the last year. Average price fell 8% year-over-year, driven lower by a majority of buyers negotiating the sale price. This month the average price difference from last ask to sale was -2.5%, the lowest point it’s reached since November 2011. Given the increased negotiability in the sale process, days on market was 17% longer than December of last year.
THE MEIER TEAM MARKET SUMMARY
Our team has been extremely active in Brooklyn, especially in the neighborhoods of Bedford-Stuyvesant, Bushwick, Crown Heights, Prospect Park South, Lefferts Gardens, Flatbush and Ditmas Park, with activity and volume never seen before. There’s very strong demand for 2-unit townhouses in these neighborhoods as buyers are looking to own and live in a duplex with outdoor space and lease one unit to defray carrying costs. These neighborhoods provide excellent subway access with growing commercial, entertainment and dining environments.
We are forecasting an approximately 18-month window in these neighborhoods. For the most part, the properties are well-priced, sufficiently maintained or renovated, and listing in the $1.25 – $1.5 million range. A $1 million mortgage results in monthly payments between $5,000 and $5,500, with monthly taxes as low as $100. The two-bedroom garden apartments are renting between $2,000 and $2,500 per month.The opportunity to live in a two story duplex with a backyard and possibly a deck comes at a very reasonable net monthly carry.
With current demand very healthy, we don’t see this well-priced inventory being available beyond this window. If this is a goal during the next year or so, we recommend jumping in now to secure a quality product at a fair price and finance it with extremely favorable mortgage rates over the next seven to thirty years. The other opportunity is to view this purchase as a transitional transaction allowing a buyer to live in the duplex in the near-term and as life pulls you in other directions to hold onto the townhouse and enjoy it as a very productive investment for years to come.
Give The Meier Team a call at 212.500.7054 if you are interested in looking at properties in Brooklyn and leveraging our expertise.