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Residential prices plateau in Bklyn, Queens

The Brooklyn and Queens residential sales market held steady during the first three months, according to two market reports released Thursday.

In the first quarter of this year, the average sales price in Brooklyn was $565,291, relatively unchanged from the same time a year ago, according to a report by Prudential Douglas Elliman and Miller Samuel Inc. In a separate report, The Corcoran Group reported that median prices dipped a mere 2% to $428,000 from the first quarter a year earlier. Similarly, in Queens, both median sales price and average sales price slipped by 1% to $34,275 and $383,596, respectively, according to the Elliman/Miller report.

“The Brooklyn market is stable,” said Michael Guerra, executive vice president and managing director at Elliman, adding that the market is expected to improve as he has seen a surge in demand since early February.

While prices remained firm, sales activity dipped during the first quarter in both boroughs due to inflated activity in the year-earlier period when there was a lot of pent up demand as confidence returned to the market, according to Jonathan Miller, CEO of Miller Samuel. In Brooklyn, the number of sales dropped 23.9% to 1,807 from the same period 2011. In Queens, sales declined 16.2% to 2,176.

Inventory in both boroughs dropped significantly, aided by a lack of new development. In Brooklyn it fell 16.7% to 6,092 units in the first quarter. That figure is slightly below the five year average of 6,280. Queens recorded a steeper decline in inventory to 8,851 units, down 35% from first quarter 2011. Mr. Miller expects inventory to rise once distressed properties in the boroughs go through foreclosure and come back into the market.

Unfortunately, the inventory for new condos will remain low due to the lack of construction these past few years and some warn that prices may go up as a result. “We have so many people who want to buy, but we don’t have product to sell,” said Frank Percesepe, regional senior vice president of Brooklyn for Corcoran, adding that the price per square foot at the Toren, a 240-unit new condo in downtown Brooklyn rose 9.5% in the first quarter from the same time last year. According to Streeteasy.com, the average price of units for sale there is $736 per square foot.

Separately, the Brooklyn townhouse market was hot in the first quarter, according to the Corcoran report. Single-family home median price rose 37% to $1.3 million and two-to-four family median sale price rose 30% to $1.07 million. The prices were boosted by two big sales in Brooklyn Heights. A single-family home at 212 Columbia Heights sold for $11 million and a two-family home at 70 Willow St. sold for $12.5 million.

All these factors as well as reports from brokers that they are busier than ever indicate a strong spring selling season. Mr. Guerra said that every open house Elliman has hosted has attracted more than 20 people.

“I suspect that the second quarter will be more robust,” said Mr. Miller.