Priced Out of Brooklyn
This weekend The New York Times real estate section looked at people who are finding themselves priced out of Brooklyn. No doubt this has been going on for ages, but the story points to some pricing trends that show that real estate in Brooklyn, or at least in the most expensive north and western neighborhoods…
This weekend The New York Times real estate section looked at people who are finding themselves priced out of Brooklyn. No doubt this has been going on for ages, but the story points to some pricing trends that show that real estate in Brooklyn, or at least in the most expensive north and western neighborhoods (from Red Hook north to Greenpoint and Gowanus and Park Slope) is quickly accelerating towards Manhattan pricing, particularly since the financial crisis in 2008.
According to the story, in the second quarter of this year there were 107 sales over $2 million in these neighborhoods, more than any other quarter. Since 2008 the median sales price has inched 33 percent closer to the median sales price in Manhattan–now $575,000 in Brooklyn versus $910,000 in Manhattan. Five years ago median rental price in these parts of Brooklyn was $1,030 cheaper than in Manhattan. Now it is only $353 cheaper.
These trends helped push out the residents that the Times profiled, all of whom wanted to stay and none of whom could afford an apartment they could live with. One couple fled to Jersey City, another wound up in Sunnyside, Queens and one person bought in East Harlem.
One broker told the Times, “For normal, middle-class people with good credit, we used to be able to say, ‘We can find you something.’ ” Now, even in once working-class areas like Windsor Terrace, Kensington, Crown Heights and Bedford-Stuyvesant, she said, “people are priced out of purchasing and landlords are asking egregious numbers.”
Just this weekend, well-known street artist Shepard Fairey told the New York Post that New York’s high rents and lack of affordable studio space is taking a toll on the city’s cultural scene and that many artists are leaving for Los Angeles. He said, “You can’t be in New York and not have either a trust fund or a good enough job to live. The reason why LA is becoming a hub is because LA still has affordable spaces for artists to have studios. New York was a hub for so long [because] high-low culture, high-low economics co-mingled very fluidly for years.”
One person who moved to Carroll Gardens in 2001 and is leaving for East Harlem had a similar lament as our reader who posted last week about what she misses about the Brooklyn she once enjoyed. He told the Times, “Carroll Gardens used to be a place in the summertime where you could get an Italian ice at one of so many pizza places. Now people go to 16 Handles,” he said referring to a self-serve frozen yogurt chain that replaced a local joint named Joe’s Luncheonette. “It’s a different group of families,” he continued. “It’s families that want the 16 Handles and not to talk to Sal.”
Life After Brooklyn [NY Times]
‘Screwed’ New York Artists are Moving to Los Angeles [NY Post]
What I Miss About Brooklyn [Brownstoner]
Photo: Jay Woodworth
For BK real estate to not be worth more in 5-10 years, interest rates would have to spike through the roof given the supply/demand imbalance currently in the market place.
Brooklyn is so much more than BBurg, CG,CH,BH,PS, DP, PH etc….Why isn’t anyone discussing Bensonhurst, Dyker, Gravesend, Flatbush, etc as more affordable alternatives? There is express train service from these areas and the commute really isn’t *that* bad. And don’t tell me the housing stock is ugly….look at BBurg and Bushwick for petesake.
My facebook feed is full of people with trust funds decrying the “yuppies” that can afford 500K for a middle class life. I’m pretty sure I don’t like what this says about my friends–but the real moral there is, do not send your children to small liberal arts colleges, for they will meet lots of really out of touch rich liberal people who work in the arts.
And, if they are having a great time, that’s great. To each his own.
Fair point. And there’s always a part of me that will love the non-yuppified part of Brooklyn. That’s where I was raised (in brownstone Bed Stuy, back when it was a “rough” area). But, now with others to take care of, I’m glad I live where I do today. I hope that other “rough” and “uncool” areas become the next “it” areas soon.
That’s exactly why I bought a place on 34th near brooklyn college. Amazing sfh 3200 sq ft, original details, super cool neighborhood. I have a yard that’s about 2000 sq ft and my piti is less than the rent i paid in dumbo. I always have a seat on the train in the morning and I get to midtown in about 40 minutes (45-50 if we get held up at the franklin junction or if someone is sick). I read on the train and I’ve never read more in my life and I love it.
Basically. Though, for what its worth, I’m not ashamed to live in a safe, and established and/or up-and-coming neighborhood (or “cool” neighborhood” if you will). Yes, many of the people who feel that Brooklyn is becoming too expensive could afford to live in, say, Brownsville or ENY. However, and no offense to the good people living there, I doubt this is their first choice for obvious reasons. The same goes for some of the “safer” but farther out neighborhoods in southern Brooklyn…they are just too out of the way for some people. I know there are express trains going to some of these areas, but weekend and late night subway trips can still be lengthy and a pain in the butt.
There were lots of incongruities in the article.
Last I checked, from Di Fara’s pizza in Midwood to Penn Station takes about 40 minutes on the Q, not “that hourlong commute” which becomes “difficult to justify” according to the times. Is that so different a commute than Jersey City Heights to midtown?
Furthermore, measuring the commute to midtown is no longer the yardstick for many. If you work in downtown Brooklyn, or near BAM, for example, commuting from most further out parts of Brooklyn is going to be a breeze.
They also didn’t mention property taxes. The $550k condo with NJ property taxes (something like $800/month) is equal to a $650 condo in Brooklyn. Add to that higher transportation costs.
The subway system is really remarkable and cannot be beat by any alternative. There are plenty of stops that service affordable neighborhoods in outer Brooklyn, Queens, and the Bronx, that nevertheless can get you around quickly and cheaply.
I think prices will continue to rise as the neighborhood continues to improve (the Atlantic Yards-Pacific Park project is a major point here, as is the development that is spurred by the project) AND as long as there are people willing to pay outrageous prices. We see the demand for properties in “prime” areas of NYC and elsewhere. The fact that there is limited supply but ever-increasing demand makes me think that we’ll be ok. As the number of foreign and domestic millionaires/billionaires grow (and even people that, while not officially in that category, can live very comfortably, the boom won’t bust anytime soon. And even to the extent that it does bust, I doubt it will be too severe. Housing prices in some areas will always be more stable than in other areas for various reasons.