Prices Stabilize Amid Foreclosed Homes for Sale in Brooklyn- By: John Cutts
Despite the high number of foreclosed homes for sale in Brooklyn relative to other areas of New York, home prices in the Brooklyn area have been stabilizing, as sales of homes in higher-cost Brooklyn areas have been surging.
Home prices in Brooklyn fell in the first quarter this year, but not as fast and as sharp as in Queens, where the housing meltdown caused the highest number of foreclosures among New York boroughs.
While foreclosures pushed down the sales price median in the first quarter in Northwest Queens by more than 18 percent from the final quarter of last year to $542,500, the lower number of foreclosures in Brooklyn pushed down the price median by only 1.8 percent to $466,000 from the median in the first quarter of last year.
The Brooklyn median price for the first quarter even marked a jump of 4.2 percent from the final quarter of 2009, a significant improvement considering that the fourth quarter median in 2009 marked a nearly 9-percent drop from the median in the last quarter of 2008.
The price impact of foreclosed homes for sale in Brooklyn on the median home price weakened because of the sharp rise in sales of homes in higher-cost neighborhoods like Brooklyn Heights and Park Slope, often called brownstone Brooklyn because of the preponderance of brownstone houses in these neighborhoods.
A total of 69 Northwest Brooklyn homes were sold in the first quarter this year, a whopping increase of 115.6 percent from 32 units in the first quarter of last year. The sales price median for these 69 units sold increased to $1.25 million, marking almost 15 percent of increase year-over-year.
Analysts said that Queens has been accounting for the majority of foreclosures in New York over the past months, but Brooklyn has been catching up. The Queens neighborhoods of Richmond Hill, Jamaica and Queens Village were particularly hit by the foreclosure crisis, with more homes in these neighborhoods entering foreclosed listings compared to other Queens communities.
Nevertheless, both Queens and Brooklyn have been experiencing increases in sales of high-end houses. Local brokers reported that the first quarter has ushered more sales of homes priced above $1 million. One factor for the surge in sales of higher-cost homes, according to local realtors, is the increased willingness of owners to reduce their asking prices to levels competitive with prices of high-end foreclosed homes for sale in Brooklyn.
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John Cutts has been educated in the finer points of the foreclosure market over 5 years.