Brooklyn House vs Apartment: Apartments Lead Before HOA Costs

Short-term rentals are effectively banned in Brooklyn. Short-term rentals heavily restricted in New York. Investment properties generally not permitted; may require owner occupancy, specific zoning, or other conditions (permit required, $145). NYC Local Law 18 (2023) effectively bans most short-term rentals under 30 days. Hosts must register, be present during stays, and may host no more than 2 guests. Entire-home rentals under 30 days are prohibited. Because entire-home short-term rentals under 30 days are prohibited, this article compares houses and apartments on long-term rental yields only.

Brooklyn apartments show higher gross long-term rental yields than houses at most bedroom counts because entry prices have decoupled from rents in a way that favors smaller property types. A 2-bed apartment at a median of $409,165 generates $2,108 a month, while the median 3-bed house at $1,037,480 commands $3,058. The bedroom difference explains some of the rent gap, but the price gap between property types is much wider, which lifts apartment yields above house yields on a like-for-like comparison. All figures below are gross, before HOA fees (which apply to apartments but not houses) and before operating costs.

These are Brooklyn (Kings County) borough medians across 38 ZIP codes. Your specific neighborhood may sit well above or below these averages, and the apartment-versus-house trade-off can flip depending on where you are looking.

Long-Term Yields by Bedroom Count in Brooklyn

Borough medians across 38 Brooklyn ZIP codes. Gross yields before HOA fees (apartments), property tax, insurance, and maintenance. Short-term rental columns omitted because unhosted rentals under 30 days are prohibited.

Apartments Offer Cheaper Entry; HOA Closes the Yield Gap

The price mechanism is straightforward: a 2-bed apartment costs a fraction of the median 3-bed house, but rent does not fall in the same proportion. Apartment rents per bedroom stay relatively sticky because professional tenants pay a premium for location and amenity rather than for square footage. The outcome is that gross rental yield per dollar of capital is typically higher for apartments than for houses on a bedroom-matched basis, which you can see in the table by comparing like rows.

Apartment gross yields in the table do not deduct HOA or common charges. For a 2-bed Brooklyn condo at borough medians, HOA typically runs around $4,222 per year, though luxury buildings in Brooklyn Heights, DUMBO, and Williamsburg can charge two to three times that for concierge service, gyms, and roof decks. Once HOA is netted out, the apparent yield advantage apartments show on paper narrows significantly, and on a net basis the gap between property types is often much smaller than the gross figures imply. Houses carry no HOA but face full responsibility for roof, façade, and boiler replacements.

One regulatory wrinkle specific to condos and co-ops in Brooklyn: individual building by-laws can prohibit leasing outright, impose minimum lease terms, or require board approval of every tenant, regardless of what NYC law allows. Co-op boards in particular often require extensive financial disclosure and may block investor purchases altogether. Review the offering plan, house rules, and recent board minutes before signing a contract on any apartment.

Bedroom Count: Yields Compress As Size Rises, Apartments Faster Than Houses

House and apartment yields both compress as bedroom count rises, but apartments fall faster. A 1-bed house yields 5.2% gross, dropping to 3.0% at 4+ bedrooms, because Brooklyn brownstone prices rise steeply with size while rent per bedroom does not. Even where legal two-family configurations capture rent from more than one household on a single parcel, the price premium at the top of the house column outruns the rent uplift.

Apartments compress even more steeply. One- and two-bedroom units typically generate the strongest gross yields because they match Brooklyn's dominant renter demographic (young professionals, couples without children) and small-format rents are bid up aggressively in transit-accessible neighborhoods. As apartment bedroom count rises, you still carry HOA and property tax on the full price of the unit, while the rent premium for additional bedrooms is modest, so yields compress. The 4+ bed apartment category is thin in Brooklyn and mostly captures combined units or penthouses where buyers are paying for lifestyle rather than cash flow, so treat that row as directional rather than diagnostic.

View Brooklyn in the dashboard → Free preview · every bedroom count and property type

neighborhood Yields Range From Under 3% to Nearly 6%

Borough medians hide enormous dispersion across Brooklyn's 38 ZIP codes. At the top of the ranking, Stuyvesant Heights/Bed-Stuy (11233) produces a long-term yield of 5.8% at a median sale price of $762,250, driven by relatively affordable housing stock and strong rental demand. Sunset Park (11220) follows at 5.4%, and Crown Heights (11213) at 5.1%. The waterfront and downtown ZIPs around Brooklyn Heights, DUMBO, and Williamsburg trade at sub-3% yields because seven-figure condo prices outpace what tenants will pay in monthly rent. The dashboard shows suburb-level data for every bedroom count and property type, so you can compare house-versus-apartment economics within the specific neighborhood you are evaluating rather than against a borough median that may look nothing like your target.

What the Table Does Not Capture

• HOA or common charges: Estimated at around $4,222 per year for a 2-bed apartment at Brooklyn medians, and not deducted from the gross apartment yields in the table above. Luxury buildings charge considerably more.
• Capital appreciation: Brooklyn houses, particularly brownstone stock in Park Slope, Fort Greene, and Bed-Stuy, have historically outperformed apartments on long-term value growth because you own the land. In a low-yield, high-appreciation borough, the long-term total-return case for houses is often stronger than the gross-yield comparison suggests.
• Renovation and conversion potential: Houses offer optionality (garden-level rental units, accessory dwelling conversions, legalising a second unit) that apartments cannot match. In Brooklyn, multi-family configurations can lift rental income in ways the median figure does not reflect.
• Financing constraints: Co-op boards routinely impose income, liquidity, and down-payment requirements that exceed lender minimums. Non-warrantable condo buildings may face restricted mortgage options, particularly where investor concentration is high or the HOA has pending litigation.
• 4+ bed data breadth: The 4+ bed row bundles 4, 5, and 6+ bedroom listings. In Brooklyn, this category mixes legal multi-family houses, single-family brownstones, and the occasional combined penthouse, so medians can swing on a handful of sales.

Brooklyn Is an Appreciation Play, Not a Cash-Flow Market

Brooklyn sits far above both the New York state median sale price of $294,094 and the US median of $242,500, while the borough's long-term yield of 3.5% sits below the state and national medians of 5.3% and 5.3%. That is the textbook profile of an appreciation market: high entry prices, modest cash flow, and a total-return thesis that depends on long-run price growth, mortgage paydown, and the tax treatment of depreciation rather than on monthly rent surpluses. The practical implication for the house-versus-apartment decision is that neither type offers strong cash flow, so the choice should be driven by capital available, appreciation conviction, and tolerance for condo-board or co-op-board governance.

Investors specifically chasing yield can find a very different proposition elsewhere in New York state. Upstate markets like Niagara Falls, Rochester, and Syracuse show long-term yields well into double digits at entry prices below $150,000, albeit with weaker demand growth and older housing stock. For Brooklyn buyers who want to stay in the borough, pair this article with the market score methodology and data sources pages to understand how the yield and appreciation signals are weighted. For related New York markets, see Queens Long-Term Rentals Yield 3.6%, Short-Term Rentals Banned and Long Island Nets Under 1.5% on Rentals: Appreciation Must Do the Heavy Lifting.

Data reflects market conditions as of May 2026.

This information is for educational purposes only and should not be considered financial or legal advice. Regulations and market conditions change frequently. Verify current rules with local authorities before making investment decisions.