The days of runaway home price growth in Brooklyn and Manhattan may be behind us. While it’s true that home values in both boroughs remain well above their previous peak levels, StreetEasy’s latest market reports show home value growth in both boroughs continued its slowdown in July.

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Manhattan and Brooklyn Home Prices: Hot, But Not Smoldering

According to StreetEasy’s Manhattan Price Index, median resale prices of all homes in Manhattan was $983,207 in July, a 6.3 percent increase compared to the same time last year. Although this was a new record high in Manhattan, annual growth has slowed for 18 consecutive months. The Manhattan Price Index, which tracks median resale prices of all homes in Manhattan and within each of the borough’s five major submarkets, remained the highest in the Downtown submarket in July at $1.2 million, followed by Upper West Side ($1.1 million), Upper East Side ($958,089), Midtown ($854,026) and Upper Manhattan ($565,690).

Although Upper Manhattan has the lowest median resale price in the borough, it has seen the fastest growth in the last year at 11.9 percent, almost twice the Manhattan-wide growth rate. As home sale prices rise across Manhattan, some buyers may be attracted to the relatively lower prices in Upper Manhattan, fueling higher price growth above 110th Street.

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In Brooklyn, median resale prices in July increased by 5.3 percent year-over-year to $524,171, according to the Brooklyn Price Index. Similar to Manhattan, the annual growth rate in July was significantly lower in comparison to this time last year – less than half the rate seen last July – underscoring the steady slowdown in resale home value growth in Brooklyn. The Brooklyn Price Index, which tracks median resale prices of all homes in Brooklyn and within each of its five major submarkets, showed median resale prices in the North Brooklyn submarket remained the highest in the borough in July at $868,390, followed by North Brooklyn ($867,346), Prospect Park ($772,186), East Brooklyn ($380,707), and South Brooklyn ($373,706). The Northwest Brooklyn submarket, which includes Downtown Brooklyn, DUMBO, and Brooklyn Heights among others, saw the greatest annual growth in median resale prices at 9.3 percent.

Co-op Inventory Sees Largest Decline in July

Inventory continued to slide in Manhattan while Brooklyn saw healthy growth in the number of homes available for sale. In Manhattan, a small increase (2 percent) in the number of condo units on the market in July was not enough to absorb the heavy loss of co-op units, which saw a precipitous 12.8 percent decline from last year. The decline in co-op units pushed total inventory down 5.1 percent from last year.

In Brooklyn, total inventory increased by 6.3 percent in July compared to last year, despite a decline in co-op units (down 10.9 percent). The growth of townhouse and condo inventory more than made up for the co-op decline in Brooklyn, increasing 10.1 percent and 19.9 percent year-over year, respectively.

Sellers Still Able to Command Full Asking Price in Final Sales

Both boroughs remained highly competitive for buyers in July, with fewer discounts offered and sellers typically able to receive full asking price in the final sale of their homes. The share of all homes on the market that saw a price cut fell to 26.8 percent in Manhattan and 23.2 percent in Brooklyn.

Since sellers offered fewer discounts in July, they were able to get more of their initial asking price in the final sale. A Manhattan home that sold in July typically did so for the seller’s full initial asking price. Brooklyn sellers typically received only 1.6 percent below their initial asking price for homes that sold in July.

Due in part to high prices, homes took 6 days longer to sell in July than they did last year in both boroughs, with homes taking a median of 50 days to sell in Manhattan and 48 days in Brooklyn.

Rents for Brooklyn’s 3-Bedroom Units Jump 7 Percent

Rent was also on the rise across Manhattan and Brooklyn in July. The median asking rent rose slightly in both boroughs compared to last year, though at a slower pace than sales prices. In Manhattan, the median asking rent increased by 3 percent from last year to $3,400. In Brooklyn, the median asking rent increased by 4 percent from last year to $2,600.

Median asking rent of one-bedroom rentals in Manhattan grew 1.5 percent in July, which was singularly responsible for rent growth in the borough; all other bedroom counts saw a slight decline or no change in median asking rent over the last year. In Brooklyn, larger rental units drove price growth in the rental market over the last year. While the median asking rent for studios and one-bedrooms declined 1.9 percent and 2.3 percent, respectively, the price for two-bedroom rentals increased by 1 percent and for three or more bedrooms, by 6.7 percent.