Brooklyn Buyers: Rates Are Up, Competition Is Down

Mortgage rates are back above 7%, and many Brooklyn buyers have paused their search. But fewer buyers also means less competition and more room to negotiate.

What higher rates cost

The average 30-year fixed rate was 7.32% as of October 22, per Freddie Mac, up from a low of 5.98% in late February.

Here's what that swing means on an $800,000 loan (principal and interest only):

That's about $700 more per month, so it's no surprise buyers pulled back.

Why this is a window for buyers

In Q3, Brooklyn co-ops and condos took a median of 54 days to go into contract, up 26.7% from last year (REBNY data). Sellers seeing fewer showings are negotiating on:

• Price, especially on listings that have sat for a month or more
• Rate buydowns paid by the seller
• Closing cost credits, often from new development sponsors

Inventory is still tight, mostly because owners with 3% rates don't want to sell. Some list, sit for a month or two, then rent instead. That's why homes are sitting even with low supply.

Wait or buy now?

If rates rise, buying now locks in your fixed rate. If rates fall, you may be able to refinance, but only if you still qualify, have equity, and can cover closing costs of the loan. Waiting for lower rates likely means more competition when you come back.

Buyers under $1 million are feeling this most. The $2 million-plus market in Brooklyn has held up better, since those buyers often put more cash down.

The Fed doesn't set your mortgage rate

The Fed held at 3.75% to 4.00% on October 28, and markets expect a hike in December. But mortgage rates follow the 10-year Treasury yield, not the Fed directly.

Let's talk

Only buy if your finances and your job feel secure. If you're thinking about Williamsburg, Greenpoint, DUMBO, or the Brooklyn waterfront, I'm happy to walk through your options.

Ralph Modica, Licensed Associate Real Estate Broker, Compass · Modica Geloso Team 917-407-0084 · [email protected]

General information only, not financial or mortgage advice.

Sources

• Freddie Mac PMMS, October 22, 2026
• Brooklyn Market Report 3Q 2026 (REBNY data)
• Norada: Fed meeting October 27 to 28, 2026