The gunman, identified as Brian Isaack Clyde, was shot and killed by police, who say they had to use rubber bullets and a taser to control him with a rope because he seemed to be trying to run.
"A number of officers searched Mr Clyde found no injuries and the suspect, currently deceased, was in possession of no firearms and it would not be appropriate for us to comment further at this time."
A nearby police commander, who declined to be named and was not authorised to go into the building where the standoff was taking place, recalled that the police were given a map by the building's management explaining where the hostage situation was, and were told to proceed to a nearby church to secure them against another hostage situation.
Witnesses said the shooter may have been shot when he was trying to make a break for the bathroom inside his home on the 500 block of N. 5th Street. Officials said Clyde was armed with two firearms. According to the investigation, Clyde was shot in the wrist when officers responded to a home alarm.
Police said there had been a disturbance in the upstairs rooms of the home. In his complaint to New York City police, the victim said he had been arguing with his brother about the way back from a date.
Police said a man and a woman had been arguing until 4:45 a.m., when a gunfight broke out while officers were on their way to the home.
The woman was shot in the leg. She was airlifted to a local hospital for treatment but was expected to survive. A male bystander, who was not identified, also was injured when police fired shots during the incident, but returned fire, police said.
Clyde remained in FBI custody while the investigation is conducted and is recovering from his death, Brooklyn District Attorney Ken Thompson said Sunday evening.
