Brooklyn Bridge Park. Photo: Lore Croghan/Brooklyn Eagle
With the long term effects of the pandemic here to stay for a while, New Yorkers are increasingly opting into home buying. Brooklyn saw an increase in residential sales during the last quarter of 2020, according to StreetEasy’s 2020 Market Report, up 30.3% from 2019.
Although StreetEasy reported the uptick in sales for the final months of the year, overall, they say, 2020 as a whole saw slow sales movement and low numbers, clocking in at only 10,751 going into contract compared to 2019’s 21, 410 during the same time for the city as whole.
Bill O’Brien has worked in Brooklyn for over 30 years. As a local commercial realtor, he has noticed the surge in specific residential sales and the fall of others. “What I hear, anecdotally, is that some of those one family house sales have blossomed” O’Brien says. “People are looking to get out of multi story apartment buildings and condos.”
Northern Brooklyn has, for many years, been experiencing a high rise development boom. Gone were the days of single family homes dominating the borough’s northern landscape, replaced by tall, mostly luxury buildings close to the city and high in price. 2020 disrupted the path forward, forcing developers and landlords to grapple with vacant apartments and negotiating leasing deals for potential tenants.
No longer bound by the confides of an office or a commute, many city dwellers, including some of O’Brien’s family members, have ditched their cramped, pricy rentals in favor of spacious, cheaper ones, sometimes abandoning Brooklyn all together to find it.
“That’s left a big gap because there’s so much ground up, new construction apartment buildings, whether it’s some of the massive stuff in Brooklyn Heights or some of what I call ‘in-fill’ buildings throughout Sunset Park, Flatbush, Crown Heights, Bushwick where they are building on every 40 or 60 ft wide lot” says O’Brien. “A lot of these landlords are going to be hurting.”
The Real Estate Board of New York has been tracking transaction and tax revenue from real estate sales since March 7. Along with investment transactions, their recently released report found residential real estate sales increased 8% in 2020 from 2019, with a 2% increase in the span of November to December 2020.
Despite the number of home sales, Brooklyn’s available inventory was 10.2% higher at the end of 2020 than at the same time in 2019, according to StreetEasy’s report.
Randy Peers, President and CEO of the Brooklyn Chamber of Commerce, sees the increase in local sales as valuable to the survival of many of the small businesses he aids which are currently dealing with the worst business crisis the City since the 1970s.
“If more people are moving into a neighborhood or a community right now, they’re going to be shopping local” Peers says. “So that’s good for local retail, that’s good for small businesses in the commercial quarter. I think it’s a good sign.”
Peers cited the clear allure of Brooklyn for COVID-19 fatigued New Yorkers. Former Manhattanites are looking for more space and more outdoor access. Less concerned with commutes, Southern Brooklyn began to draw in more potential buyers with its ample single-family home offerings.
Brooklyn saw a record high number of homes sold in 2020 at 2,213. The prices of the homes sold and current inventory reflect the adjustment to the market rate, falling 2.2% in 2020.
Though more people are coming for a more permanent stay in Brooklyn, inventory is growing too, with Brooklyn adding 17.8% more inventory to the market than last year- 3,134 new homes went up for sale, according to StreetEasy. “We’re still a “full home shopping season behind” says StreetEasy economist Nancy Wu.
Despite the uncertainty of the real estate market and the COVID-19 unknowns, Randy Peers still has hope that Brooklyn will recover its charm and continue to be as resilient as ever.
“Even during the pandemic when people are fleeing other parts of the city, they still want to be here” Peers says. “They still want to be a part of what makes this a special place and that’s what gives me hope.”