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Brooklyn Home Sale Prices Rose MORE SLOWLY IN 2007, New Study FindsAt 4%, Price Rise is Half of 2006 IncreaseNew York, February 7, 2008 – Brooklyn home prices remained strong but rose more slowly in 2007 than 2006, according to a new report from HMS Associates, a real estate consulting and appraisal firm. The 2007 price rise was four percent, from $609,176 to $634,915, compared with an eight percent increase in 2006. “Considering the current climate, there is still a strong real estate market in Brooklyn,” said Sam Heskel, HMS executive vice president. Even though prices rose in 2007, the number of properties sold took a tumble, down from 4,376 to 3,374, or 23 percent, according to the HMS report. Data included one through four family homes, co-ops, and condos in 16 representative Brooklyn neighborhoods. Why The Drop in Volume While Prices Still Rose Heskel noted several reasons for the high price coupled with the drop in sales volume in 2007. Sellers were still reluctant to come down in price, he said, and buyers were still playing a waiting game to see if they could get better prices. “Even more important, the subprime crisis has caused lenders to tighten up standards for granting a loan, making it more difficult to get home financing,” said Heskel. “Buyers and sellers may agree on a sale price, but the buyer fails to qualify for a loan under the tighter standards. Because of this, brokers are seeing many contracts fall through. “Given the continuing rise in prices and the decline in properties sold, it may be a while before home prices finally come down to realistic levels,” he said. Neighborhoods with a high percentage of subprime loans have already seen a drop in home prices.” Quarter by quarter, prices rose nine percent in the fourth quarter, 12 percent in the third quarter, three percent in the second quarter, and nine percent in the first quarter. All comparisons are with the corresponding quarter of 2006. For the year, significant price rises occurred in the Clinton Hill (up 8%) and Bay Ridge (up 7%) neighborhoods, while Carroll Gardens and Boerum Hill saw double digit price declines. The largest increases in number of sales occurred in Boerum Hill and Carroll Gardens, while Canarsie and Crown Heights had the biggest declines in transaction count. A fourth quarter highlight was a 57 percent increase in Cobble Hill home prices, despite a 25 percent fall in number of home sales. But full year 2007 home prices here fell ten percent. The report contains data on single- and multi-family homes as well as condos and co-ops. It includes neighborhoods that show both increases and decreases, and deemed together a fair reflection of what is happening in Brooklyn as a whole, according Heskel. Single family home prices across all neighborhoods studied rose from $607,000 in 2006 to $669,000 in 2007, four-family homes from $1,142,000 to 1,354,000, co-ops from $408,000 to $444,000, and condos from $546,000 to $587,000, the report also showed. About HMS Associates HMS Associates is a full-service Brooklyn-based residential and commercial real estate consulting and appraisal firm. Founded by Sam Heskel in 1998, the firm serves all of New York City and its surrounding areas. Heskel, an associate member of The Appraisal Institute, is state certified in New York and New Jersey and is a member of The National Association of REALTORS®. He is also a member of Multiple Listing Services for Brooklyn and Long Island (includes Queens), Putnam and Westchester counties, and the Greater Hudson Valley.
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