Manhattan’s grip on the new condo market in New York City is loosening.
Sales volume in Manhattan has flattened in the last decade, according to Marketproof data reported by Crain’s. The outer boroughs, specifically Brooklyn and Queens, are experiencing continued growth.
It appears to be a matter of inventory numbers, according to Marketproof’s tally of signed contracts that dates back to 2015. Last year, 1,339 condos were approved for sale in Manhattan, fewer than the 1,474 approved in Brooklyn. So far this year, there have been 202 more approved units in Brooklyn than Manhattan.
Brooklyn’s sales volume also benefits from the significantly cheaper prices compared to its neighbor. In Manhattan, the asking price for new condos averages $1,737 per square foot. In Brooklyn, the average asking price is $1,249 per square foot, only slightly higher than Queens’ average asking.
The flattening of sales in Manhattan predates the rapid rise in interest rates over the last 18 months. Instead, the factors driving the comparative sales growth in the outer boroughs include elevated land costs, changes in lifestyle stemming from the pandemic and a lack of available sites in Manhattan.
The ramifications on the condo market could be significant. Marketproof projects that if long-term trends hold, Brooklyn could surpass Manhattan in new condo sales in roughly five years. While Queens also has a stronger growth rate than Manhattan, the limited size of its market doesn’t threaten Manhattan’s stranglehold on the new condo crown.
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Brooklyn, Queens gain market share in up-and-down year for new condos
After a sales dip in July, New York City’s new condo market surged last month. New condo sales in the city rose 5 percent from July to August, according to Marketproof. The gain came after sales declined by 22 percent from June to July.
In August, sales were up 26 percent when compared to pre-pandemic levels. There were 262 contracts signed during the final full month of the summer.
— Holden Walter-Warner