NYC Price Increases Keep Sailing Into The Clouds
Real estate in New York City seems to continue its precipitous rise—and in some unlikely neighborhoods.
In New York, real estate price increases have set mind bending numbers in the third quarter of 2016, according to a report just released from the Real Estate Board of New York. Here are the stats: Average prices in Brooklyn reached $891,000—$523,000 in Queens and $400,000 in the Bronx but what’s really made for fascinating reading are the neighborhoods scoring the highest gains.
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In Manhattan it wasn’t the ultra-chic Soho or Tribeca that saw their numbers skyrocket, but Midtown East where a luxury development at 432 Park Ave. spiked the numbers up to a brain scrambling 225 percent to $6.795 million. Roosevelt Island co-ops also scored an astronomical 97 percent increase to $742,000 and East Harlem raised eyebrows with an increase of 63 percent to $667.
One of the most interesting increases will be ringing alarm bells for anti-gentrification activists—the heart palpitating 180 percent in Ocean Hill/Brownvsille, Brooklyn to $423,000. It’s still one of the poorest neighborhoods in New York but surely, that’s on the cusp of changing.
In the midst of new developments, Gowanus, a superfund site, saw toxic house prices weren’t deterrent for buyers as prices rose 41 percent to a humbling $2.035 million. Staten Island, too was among the heavy hitters with an 81 percent increase for its Arrochar area to $707,000.
If a forecast released on Tuesday, October 25th from the New York Building Congress is anything to go buy, NYC house prices are likely to stay in the stratosphere for the next year or two (at least) as construction spending is also expecting hit new records.
The trade group’s annual analysis projects New York City construction spending will reach $43.1 billion in 2016, marking the first time spending would surpass $40 billion and representing a 26 percent increase from a year earlier when spending touched $34.3 billion. Adjusting for inflation it’s almost 50 percent higher than the city’s previous boom of 2007—and we all know what happen after that.
Adding a fuel injected burst to construction was the expiration of the state’s 421-a tax break for certain residential buildings. As developers rushed to meet the deadline, planning permits were handed out like hardhats on a high rise.
Let’s hope the boom and bust of 2007/08 doesn’t repeat itself—or they’ll be plenty of condos lying vacant in the clouds. Affordable housing, anyone?
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