Although sales prices for properties in Brooklyn and Westchester remained stable in the first quarter of 2018, the number of sales dropped in a year-to-year comparison, according to new data by Douglas Elliman released Thursday.
Sales in the New York City borough of Brooklyn fell 13.9%, while sales in Westchester, a mostly suburban area north of New York City, dropped 7.3%. Luxury properties fared slightly better in Westchester, falling 6.1%, while high-end properties in Brooklyn took a 18.5% hit. Median sales prices rose slightly in both areas—by 3.2% in Brooklyn and 4.7% in Westchester.
Corcoran on Thursday also reported a slump in Brooklyn’s luxury market in the first quarter, with a 10% decline in new development sales and a 16% drop in the median luxury sale price overall.
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The New York City borough of Queens, on the other hand, saw significant growth in the first quarter, according to Douglas Elliman. Although it experienced a 2.7% drop in overall sales, Queens saw a healthy 13.4% bump in its median sales prices. In its luxury sector, sales rose by 11.8%, with a 10% increase in the median luxury sale price.
All areas fared better than Manhattan, which hit its lowest sales levels since the Great Recession in Q1, according to a separate report released by Douglas Elliman last week.
"We haven’t seen a regional change like this in a while," said Jonathan Miller, author of the Douglas Elliman reports and president of appraisal firm Miller Samuel. "It is something to take note of."
Inventory Issues
Mr. Miller attributed these shifts to a combination of shrinking inventory of properties and uncertainty surrounding major policy developments like tax reform and interest rates.
In Brooklyn and Westchester, inventory shrunk 10.8% and 4.6%, respectively. Queens grew its inventory by 5.2% since the same period in 2017, according to Douglas Elliman’s report released Thursday.
Demand for housing in Westchester remains strong, said Scott Elwell, Douglas Elliman’s senior executive regional manager of Westchester and Connecticut. The main problem for agents in the area is that there are not enough houses in Westchester to meet the demand, he said.
Mr. Elwell said that buyers have raised concern over the new tax rules, which cap out how much in local income and property taxes they can deduct from their overall filing. However, he said that once buyers speak with an accountant and do their research, they "are ready to go."
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In Brooklyn, the inventory of properties has shifted up in price, according to data from Stribling & Associates also released Thursday. At 32% of the borough’s overall housing stock, there were were nearly double the inventory of properties priced between $1 million and $2 million in Q1 than that of properties priced under $500,000, which accounted for only 17% of properties available.
According to Garrett Derderian, director of data & reporting at Stribling, this is the first time that the $500,000-and-below figure has dipped under 20% of the market. In the first quarter of 2010, he said, those types of properties made up more than half of Brooklyn’s housing stock. "We are seeing that market shrink considerably," he said, citing rising prices in East and South Brooklyn.
Although Northwest Brooklyn saw a 12% year-over-year decline in sales due to a slump in new development closings, Mr. Derderian expects that figure to change moving forward as a spate of new luxury high rises are constructed in Downtown Brooklyn.