The StreetEasy Market Reports include extensive data and analysis for Manhattan and Brooklyn broken down by neighborhood, home type, and bedroom size. The analysis below explores top line trends for each borough. For additional data and analysis, download the full report PDF here. 

The real estate markets in Manhattan and Brooklyn closed the final quarter of 2015 with record-high prices as sales inventory continued to slide in Manhattan and competition among renters intensified in both boroughs.

The median resale price of homes in Manhattan grew 7.1 percent from last year to $1,002,008, according to the StreetEasy Price Index, marking the first time it has ever exceeded $1 million. The highest growth was in Upper Manhattan, where the median resale price grew 14.6 percent from last year to $641,882, followed by Upper East Side (9.1 percent), Upper West Side (8.1 percent), Downtown (6.1 percent) and Midtown (4.5 percent). Upper Manhattan has led the borough in annual resale price growth for 14 consecutive months, underscoring the highly competitive environment above 110^th Street as more buyers move their home search northward amid high prices elsewhere in Manhattan.

Manhattan resale price growth was aided by a slight reduction in inventory. The number of homes available in Manhattan throughout the fourth quarter fell 3.5 percent from last year to 10,122, the lowest level since StreetEasy began tracking data. Not coincidentally, the steepest inventory losses were seen in the Upper Manhattan submarket, where resale price grew the most in the fourth quarter. The number of homes available in Upper Manhattan throughout the fourth quarter fell 21.4 percent from last year to 734, followed by Upper East Side (5.7 percent), Downtown (2.7 percent) and Upper West Side (2.4 percent). The Midtown submarket was the only area of Manhattan to see modest growth in inventory (2.7 percent) in the fourth quarter.

Use the chart below to see annual changes in sales inventory for every neighborhood in Manhattan and Brooklyn:

[tableau server=”public.tableau.com” workbook=”Q42015MarketSummary” view=”inventoryGrowthWindow” tabs=”no” toolbar=”no” revert=”” refresh=”yes” linktarget=”” width=”600px” height=”670px”][/tableau]

In Brooklyn, the median resale price of homes grew 8.3 percent from last year to $537,193, according to the StreetEasy Price Index. The highest growth was in East Brooklyn, where the median resale price grew 18.1 percent to $464,285, followed by South Brooklyn (8.8 percent), North Brooklyn (8.3 percent), Northwest Brooklyn (8.2 percent) and Prospect Park (7.1 percent). East Brooklyn, which includes neighborhoods such as East New York, Crown Heights and Bedford-Stuyvesant, has led the borough in annual resale price growth for 17 consecutive months.

This growth in median resale price came despite modest growth in inventory across Brooklyn. The number of homes available in Brooklyn grew 1.5 percent from last year to 4,746, roughly half the size of the Manhattan sales market. All areas except South Brooklyn and East Brooklyn saw annual inventory gains in the fourth quarter, but a 2.3 percent and 1.7 percent decline, respectively, tempered overall inventory growth across the full borough.

Use the chart below to track historical median resale price and median rent price among the major submarkets in Manhattan and Brooklyn:

[tableau server=”public.tableau.com” workbook=”priceIndices” view=”StreetEasyPriceIndex” tabs=”no” toolbar=”no” revert=”” refresh=”yes” linktarget=”” width=”600px” height=”720px”][/tableau]

Rent Prices Continue Steady Rise Throughout Quarter

The median rent price in Manhattan grew 4.7 percent from last year to $3,112, according to the StreetEasy Rent Index. The highest growth was in Upper Manhattan, where median rent grew 6.6 percent from last year to $2,331, followed by Upper East Side (5.6 percent), Upper West Side (5.2 percent), Midtown (4.4 percent) and Downtown (3.9 percent). Rent price growth was fueled by a slight reduction in rental units available on the market. Total rental inventory in Manhattan throughout the fourth quarter fell 2.3 percent from last year to 20,859, the lowest level since the first quarter of 2014.

The median rent price in Brooklyn grew 2.1 percent from last year to $2,630, according to the StreetEasy Rent Index. The highest growth was in Prospect Park, where median rent grew 4.7 percent to $2,815, followed by North Brooklyn (3.1 percent), Northwest Brooklyn (2.9 percent) and East Brooklyn. In South Brooklyn, the median rent price declined 1.2 percent to $1,595, the only submarket in Manhattan or Brooklyn to experience annual rent price decline. Total rental inventory in Brooklyn throughout the fourth quarter grew 4.2 percent from last year to 12,403 due to growth in the two largest submarkets. In East Brooklyn, the number of rental units grew 27.3 percent from last year to 3,772 and in South Brooklyn inventory grew 22.2 percent from last year. All other markets saw modest to significant decline, however.

Sales Market Competition Builds in Manhattan, Eases Slightly in Brooklyn

Buyers in the Manhattan sales market faced greater headwinds in the final quarter of 2015 than last year, according to four key market indicators. The typical time on market for homes that sold in the fourth quarter declined three days from last year to 51 days, indicating that the pace of home sales was slightly more brisk. Sellers also received more of their initial asking price in the fourth quarter than they did last year. The median sale-to-list price ratio of homes that went into contract in the fourth quarter grew 1.2 points from last year to 99.4 percent, meaning homes typically sold for 99.4 percent of initial asking price. Finally, discounts were harder to find in the fourth quarter than last year. The number of homes that were discounted during the quarter as a share of all homes available declined 3.3 points from last year to 29.0 percent. The typical price cut declined 0.3 points from last year to 6.4 percent.

Overall the Brooklyn sales market was slightly less competitive than last year amid mixed results among four key market indicators. The typical time on market for homes that sold in the fourth quarter declined by one day from last year to 48 days, indicating that the pace of home sales was roughly the same. Sellers were able to get roughly the same percentage of their initial asking price in the fourth quarter as they were last year. The median sale-to-list price ratio of homes that went into contract in the fourth quarter fell 0.1 points from last year to 98.3 percent, meaning homes typically sold for 98.3 percent of initial asking price. Discounts were slightly easier to find in the fourth quarter than last year. The number of homes that were discounted as a share of all homes available grew 2 points from last year to 25.7 percent. The typical price cut grew 0.1 points from last year to 6.1 percent.

Use the chart below to explore the most and least competitive neighborhoods in both boroughs according to time on market and sale-to-list price ratio.

[tableau server=”public.tableau.com” workbook=”Q42015MarketSummary” view=”saleListWindow” tabs=”no” toolbar=”no” revert=”” refresh=”yes” linktarget=”” width=”600px” height=”670px”][/tableau]

12-Month Outlook: Slower Sales Price Growth

For the Manhattan and Brooklyn sales markets, 2016 will look more like 2012 and less like 2014. The spike in global and investor demand in 2014 appears to have been fully served. There are even signs of oversupply within Manhattan’s luxury market, which has experienced consecutive price declines since early 2015. These are markets that are returning to sustainable growth rate after the party of 2014: expect lower price appreciation in both Manhattan and Brooklyn in 2016.

Record-high prices in Manhattan will weigh on buyers and increased supply in the luxury segment will dampen price growth. The median resale price is forecasted to grow by 0.8 percent over the next 12 months to $1,010,243, according to the StreetEasy Price Forecast, a significant reduction from the 7.1 percent growth over the previous 12 months. The last time Manhattan saw annual price appreciation at or below 0.8 percent was February 2012. After robust growth throughout 2013 and 2014, we anticipate the Manhattan sales market will cool to the “pre-fervor” pace of 2012 in the coming year.

Slower appreciation is also expected in Brooklyn, where the sales market has become slightly less competitive in the last year. The median resale price in Brooklyn is forecasted to grow by 4.2 percent over the next 12 months to $560,005, according to the StreetEasy Price Forecast, just half the growth rate of 2015. The last time Brooklyn saw annual price appreciation at or below 4.2 percent was October 2012.

To see additional data, analysis and graphics, download the full report PDF here.