The residential market in Manhattan may be struggling because of the pandemic, but Brooklyn’s is hopping.
In August, the borough nearly set a record in terms of pending home sales, while contract activity sunk in both Manhattan and Queens, according to a new StreetEasy report.
In Brooklyn, the number of homes that went into contract rose 37 percent year-over-year, with 735 deals inked. That’s below the borough’s all-time high of 748 pending sales in March 2019. The gains last month were largely driven by lower-priced properties going into contract.
Sales in what StreetEasy defines as the Prospect Park submarket (which includes Park Slope, Windsor Terrace, Prospect Heights, Prospect Lefferts Gardens and Prospect Park South) saw the largest year-over-year increase, with 111 homes in the area going into contract. That’s a 117 percent jump from August 2019.
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Manhattan’s contract activity, by comparison, fell 6 percent year-over-year, and inventory was the highest it’s been in more than a decade. In Queens, contract activity fell more than 4 percent.
In a statement, StreetEasy economist Nancy Wu said Brooklyn’s strong pending sales are an indication that “contrary to popular belief, many are making the commitment to live in the city for the long term.”
Wu said Brooklyn’s performance compared to Manhattan reflects buyers’ preference for larger homes at lower prices, rather than living close to the office — a factor that’s been on ice since the pandemic began and many companies were forced to shift to remote work. Some companies, including Twitter and Facebook, have even announced that working from home will become a permanent fixture for some of their workforce.
“All else equal, Brooklyn homes provide more bang for a homebuyer’s buck than Manhattan,” Wu said. “The striking surge in new deals in Brooklyn is the one of the first optimistic indicators for the city’s sales market.”
For appraiser Jonathan Miller, Brooklyn’s housing market has been contrarian to the rest of the city for years.
“Brooklyn is the outlier that we’ve been seeing since the financial crisis,” he said. Recalling a trip to Asia where he saw locals wearing Brooklyn apparel, Miller attributed that growth to the borough “becoming a destination” globally.
According to Miller’s monthly report on contracts for Douglas Elliman, pending sales of single-family homes in Brooklyn increased by 156 percent year-over-year in August, while condos shot up 33 percent, and co-ops saw a 182 percent jump compared to the same period last year.
“Brooklyn is booming,” he said.