Prospect Heights Market Report
Q4 2023
You’ve probably read the headlines about interest rates. These national stories are interesting, but if you’re like me, you care more about how this impacts your family. Whether renting or looking to buy/sell, these rates affect your housing costs and likely your living decisions for the next few years. If you already own, you’re curious about how this impacts your home value.
I advise many of my clients anecdotally about these trends in real time. As every neighborhood (or even block) in Brooklyn and New York City tells a different story, I wanted to create a hyper-local resource for where I live.
One of the clear trends of the past year is the dramatic slowdown in the number of transactions in the market. While there are still two months left in 2023, this year's average transactions per month is 35% lower than in 2021 and 26% lower than in 2022. Both 2022 and 2023 are below the 5-year average from 2015-2019 of 308 units (I removed 2020 like I hope to remove it from my memory).
We see no sign of price softening in Brooklyn at the current listing rate. As with national trends, many homeowners are not interested in moving with the lower mortgages secured over the past few years.
On a recent call with Corcoran, our CEO, Pam Liebman, noted that only 1,200 apartments were for sale in all of Brooklyn (wow!). This is a 20% decline year-on-year for Brooklyn and a 40% decline in inventory for Park Slope and Kensington/Windsor/Ditmas/Flatbush.
Nationally, limited inventory means that prices have been maintained. Demand in our corner of Brooklyn is still outpacing supply. The buyers in this market are qualified and understand that these interest rates don’t dictate having another baby or relocating for work.
In Prospect Heights, prices have risen for condos and co-ops on a price per square foot basis. For townhouses, prices have dropped a little bit. Townhouses as a product can vary more regarding size, condition, and number of units, making it harder to compare on a price per square foot level.
The townhouse story becomes more complex when you assess the average transaction price for the past three years. While the price per square foot has decreased, the average sales price has increased over the past few years.
I leaned on Corcoran’s historical 5-year report to help understand this story around townhouses a bit more. While the report groups Prospect Heights, Clinton Hill, and Fort Greene together, I like the comparison between single-family and multi-family homes. The number of multi-family sales certainly dramatically reduces the average price per square foot. Corcoran’s report highlighted the most expensive sales every year. This was my sign to explore the outliers in the data. A single townhouse sold for $6.390 million in 2022 is enough to increase the mean significantly. When I looked at 2023 data, I found that a “townhouse” at 357 Flatbush Avenue was sold for $11.6 million. While this is classified as a residential transaction, the location has 17,000+ internal square feet at an average price per square foot below $700, significantly decreasing the average.
The last metric that buyers and sellers ask a lot about right now is days on market. This is one where the national story does not match the local one in Brooklyn. Condos on the market are selling 43% faster in 2023 than in 2021!!! Days on the market are significantly shorter than two years ago. Buyers have limited inventory and know that when something is good for them, they must jump on it. Co-op and Townhouses are relatively flat compared.
This is something significant to consider if you are a seller in this market. If your property is not moving, it’s likely not priced correctly. (Okay, that’s the case in any market, but this is the data telling you that interest rates can’t just be the excuse.)
I wanted to see the most expensive block in our neighborhood for fun! I know my favorite block (which isn’t mine lol), and I was curious to see if that translated to real estate prices. The most expensive block in Prospect Heights is block 1151, with an average price of $3,301,585 for purchases over the past three years. Block 1151 is bound by Prospect Place (North Side), Vanderbilt Ave, Carlton Ave, and Saint Marks Place (South Side). I thought Block 1165, Park Place (South Side), and Sterling Place (North Side) between Underhill Ave and Vanderbilt Ave would be because those houses on Sterling are massive and beautiful. There haven’t been many transactions on the block in the past three years- it will be one to watch!
Given the healthy signs of the Brooklyn real estate market, if you’re a potential buyer, it’s worth considering how these prices might move when/if rates start to go down.
As someone who loves raising her children in this city, I delight in seeing so much trending in the right direction. While Brooklyn isn’t perfect, it’s refreshing to see how our neighborhood has triumphed from the days of COVID-19 when there was talk of cities past their prime.
Are there other burning real estate questions you’d like a data-driven answer to? Shoot me a note, and I’ll answer them in another post!
-Katie