An apartment construction boom in the New York borough of Brooklyn is adding thousands of new dwellings to the area’s housing supply, reflecting trends in U.S. apartment construction in metropolitan areas nationwide.
More than 6,000 new apartment units are under construction and are expected to be ready by November, 2016, according to analyst Nick Fitzpatrick, writing in an article on the Forbes website.
Fitzpatrick, a multifamily analyst with Axiometrics, a housing analysis firm specializing in apartments and student housing, notes that just over 2,000 more units are expected to become available in the Brooklyn market in 2017.
The 2016 numbers represent a substantial increase over the 969 apartments that came into the Brooklyn market in 2015, Fitzpatrick reported.
Fitzpatrick cites “Brooklyn’s hipness and trendiness” as a contributing factor that makes the borough an appealing site for developers. He also identified the expansion of well-paying jobs in the Brooklyn Tech Triangle and throughout Brooklyn as a key economic force behind the substantial expansion.
Average effective rents in Brooklyn, according to data from October 2015, are just above $3,800 per month, Fitzpatrick reported. This indicates an increase of 4.8 percent over the average effective rent in October 2014. Average effective rent is represented by the asking rent price minus concessions.
Occupancy rates throughout Brooklyn’s apartment market remain high. Fitzpatrick noted that existing apartments were 97.4 percent occupied as of October 2015. Demand for new housing continues to increase throughout the borough, serving as another driving force behind the substantial apartment expansion.
Beyond the Borough
Overall, the New York Metro area is experiencing a substantial growth in housing, with Brooklyn representing the largest part. Fitzpatrick reported that the New York area is expected to add more than 24,500 apartments in 2016. This significant growth puts New York at the top of the list of booming metropolitan areas nationwide.
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