Brooklyn Market at a Glance:
- 878 contracts signed
- 88 average days on market
- 1,665 homes in the inventory
- $1,023 Average price per square foot
The housing market in Brooklyn faced multiple challenges in the first quarter of 2023, which caused potential buyers to hesitate. Higher mortgage rates, economic uncertainties, and recent bank collapses contributed to the market's cooling trend from its record-high pace seen in the previous year. As a result, the market saw a significant decline in closings, and contract activity was also lower than the same period in the previous year.
During the first quarter of 2023, there were 1,164 closings, marking a 46% annual decline and the lowest figure since the market pause in 2020. The decrease in sales was not the only challenge, as inventory also declined by double digits due to fewer listings and less new development entering the market. The sixth consecutive quarter of annual inventory decline marked the second-lowest number of available listings since 2014 (excluding the pandemic market pause).
Despite the challenging environment, the median price of resale condos and co-ops increased year-over-year, while new development prices fell. The market's sensitivity to higher mortgage rates resulted in an increased market share of sales for smaller, lower-priced residences. However, the overall average and median price declined annually for the third consecutive quarter. Additionally, new development average price per square foot increased by 4%, driven by sales in prime Brooklyn neighborhoods. Overall, the first quarter of 2023 saw a challenging housing market in Brooklyn, with a decline in sales and inventory. Nonetheless, there were some positive signs in specific areas of the market.