They say that some folks have all the luck. While often we need look no further than the towers in the sky to try and imagine that life, a new housing report cited in The Brooklyn Ink (1) suggests that the good luck may not always be the case.
There was a period; we all remember it, when the markets were going up and up. If you were living in the New York/Metro area you undoubtedly heard about the striking prices being commanded in Manhattan especially. However that strong demand for palatial spaces soon hopped over the water to Astoria, Jersey City, and areas in Brooklyn. Notably the neighborhoods of Williamsburg and Greenpoint.
Basic economics reminds us that products only have value if people are willing to pay the price you are asking. When demand outstripped supply, the prices kept going up and up. Those priced out of the market then can also blame low interest rates and a federal government that wanted every individual to be able to stick up their flagpole in their individual “piece of America.” When people began defaulting on these expensive places they never could really afford in the first place, that was when the party was over.
This new analysis of recent history shows that “for the last eight years, the median sales price in both Williamsburg and Greenpoint have been significantly lower than the Brooklyn average.” While that may sound troubling for real estate moguls in Brooklyn hoping to make a killing, “the price per square foot has been much higher, indicating a market for smaller apartments.” So get ready for luxury tenement housing and subdivisions. Can’t you just picture it? The split-luxury-shared-bathroom period?
Of course the “new and relatively luxurious” properties which have been par for the course in Williamsburg have “been hit hard.” There are these palatial palaces in the air which are filled with air because no one can afford to spend the money to live there.
Don’t worry though, the rich and powerful aren’t going anywhere anytime soon. From the same report, “…these neighborhoods have made a relatively speedy recovery.” So the news is bad news for luxury apartments that are big, even though they are still on the rebound? While that may sound like double speak to some, the fact is that there are still apartments on the market in these neighborhoods and many of us still can’t afford them.
Until we are among them, we can only look up and daydream for their continued success.