Residential: Brooklyn's Growth Spurt Tapers Off

The rapid growth seen in Brooklyn’s residential market over the past few years has tapered off thus far in 2008, according to a Q1 apartment research report by Marcus & Millichap Real Estate Investment Services. One result of the slowdown has been a reduction in the number of apartment buildings changing hands.

“There’s certainly been a softening in transaction velocity in the first quarter,” J.D. Parker, regional manager of Marcus & Millichap’s Brooklyn office, tells Real Estate New York. “We saw this toward the end of last year as well, but it has continued to decline. I’m seeing somewhere between a 50% and 65% decline in transaction velocity in apartment building sales in Brooklyn.”

While the dropoff may appear steep, Parker puts it into perspective. “The market was unusually active from 2004 through the early part of 2007, so this is a much more normalized market,” he says. “Before the credit debacle of last summer, the market of the last three years was overheated.”