It seems, sort of inevitably, that the constant barrage of crazy updates on Brooklyn real estate—houses renting out for $25,000 a month, brownstones being sold as "castles," high level brokers referring to the borough un-ironically as "the new Manhattan"—are finally catching up to us. A report today from the Real Deal indicates that housing prices in Brooklyn (the second most expensive city in America, you may recall) are rapidly closing in on those in Manhattan, and may soon shut the gap entirely.
For several years now, rents have been rising at a notably faster rate in Brooklyn than in Manhattan, and Corcoran broker Lindsay Barton Barrett told TDR, “When I get a call from a buyer looking for a place in Brooklyn and they say, ‘I want to move there because I want more space for my money,’ I don’t beat around the bush. I immediately tell them they’re going to be disappointed.”
Of course, the price comparison varies dramatically from neighborhood to neighborhood (brokers say Carroll Gardens, for instance, is "like an extension of the Manhattan market"), and there are a few factors that skew the numbers a bit; namely, a current shortage of available places in Manhattan, and areas like Murray Hill or South Street Seaport whose prices have yet to recover from the housing crash.
Still, though Barrett notes that Brooklyn's real estate boom "started from the bottom," she notes, "the buyers have now changed [...] Your money is going a lot further if you're buying a townhouse or a very large apartment in Brooklyn. But if you're looking for a two-bedroom apartment, the prices are much more similar." In other words, even though we're closing the gap, the real estate market here does still have its advantages, and they seem to be almost exclusively geared toward the very wealthy. Glad we checked in on this.
Follow Virginia K. Smith on Twitter @vksmith.