New York Fed: 2 concerns holding Brooklyn back
Despite growth, unemployment remains more than 9%
Nestled inside New York City, the Brooklyn borough has remained particularly strong in recent years, especially when compared to other boroughs.
The borough has experienced strong job growth, a strong housing market and stronger trends in wage and salary earnings, William Dudley, president and CEO of the Federal Reserve Bank of New York, said at Brooklyn College.
And this can be seen in the borough’s commercial real estate market, as the vacancy rates are now lower in Brooklyn than in Manhattan, in addition to the median home price rising by roughly 10% in each of the past two years and rentals posting similar strength.
Plus, the borough’s industrial neighborhoods, such as the recent development of the Atlantic Yards and Brooklyn Navy Yard, are doing particularly well, spurring the areas economy and new jobs.
However, it’s not all good news. Brooklyn still has two areas of concern, Dudley explained.
1. Housing affordability and poverty: One in four residents still live in poverty and many struggle to pay rent or mortgage. And despite the job growth, Brooklyn’s unemployment rate has remained high, averaging more than 9% in 2013. At the end of 2013, more than 11% of mortgage debt in Brooklyn was 90-plus days delinquent, significantly higher than the New York State and national delinquency rate.
2. Superstorm Sandy: Although many areas of the New York City metropolitan region were hit by the storm, the waterfronts of Brooklyn were hit particularly hard. The Brooklyn economy managed to bounce back in December 2012 and acclerate in the Spring after dropping in November. But challenges still remain for the future, and maps show that a much larger number of Brooklyn residents and business are at risk of a future storm, creating a serious affordability problem in the years ahead.