Hurricane Wall Street Hits the Boroughs

“The lookers are gone,” said Stribling’s Brenda Vemich, sales director at One Hanson Place, the condo hewn from Brooklyn’s tallest tower, the old Williamsburgh Bank Building.

The economic crisis has rippled across the rivers, driving sellers into hiding, buyers into tizzies of anticipation and analysts and brokers into thorough consternation. What the heck is going on out here?

Slower sales, for one thing, a sluggishness that’s dragged from the summer into an uncertain fall. With this could soon come price tumbles. And with that, from the Bronx through Queens, Brooklyn and Staten Island, the decade’s first real buyer’s market.

It’s all thanks to the calamitous financial events in Manhattan. 

“It’s already been affecting sales,” said Jonathan Miller, president of appraisal firm Miller Samuel and author, for brokerage Prudential Douglas Elliman, of widely watched Brooklyn and Queens market reports. “I think that the situation over the last couple of weeks has the potential to make it worse, simply because there’s growing concern about more limitations on available credit.”

Brooklyn condo sales dropped 11.3 percent annually in the second quarter, from 778 to 690, according to Miller Samuel. Condos in new developments accounted for about half those transactions. Although prices continued to rise, the average condo sales price increased by only 4.9 percent from the quarter before—$573,060 to $601,280—compared to 8.6 percent from the same quarter last year. In Queens, the average condo price rose 6.4 percent, from $244,411 to $260,146, while other markers remained steady.

“The less differentiated your product is, the more difficult time you’re going to have right now,” said Jonathan Butler, founder of the blog Brownstoner.com and a homeowner in Clinton Hill. “Anything that can make a project stand out right now, whether it’s the design or the finishes, that’s more important in a tough market.”

ONE HANSON PLACE opened two years ago in Fort Greene. The 178-unit development is 80 percent sold, and 70 residents have moved in. Ms. Vemich sees them—and their brunch visitors—as her most valuable assets in selling the apartments.

“In today’s market, people want to see what they’re buying,” she said. “They don’t want to buy off of floor plans. … Through word of mouth, that’s how we’re getting our clients and our customers. We’re on-site, we’re there seven days a week.”

Ms. Vemich said that sales had slowed through the summer, as usual, and have been less brisk this fall. Investors shopping for a second or third property—the lookers—are just not there.

“We have seen a slowdown,” she said. “But we haven’t seen it stop.”

In the past two weeks, she sold two apartments, a one-bedroom and a three-bedroom combo unit. Ms. Vemich credited the sales to the building’s finishes, like the landmarked bank hall, and the views (“On a clear day, you can see to Long Island!”). Next Page >