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Survey shows uptick in confidence in commercial market
August 14, 2013
President, Real Estate Board of New York
A quarterly survey of Real Estate Board of New York brokers revealed a slight uptick in confidence for the commercial market due to favorable financing. The residential brokerage side saw a small decline of confidence related to low inventory and rising interest rates for the second quarter of 2013. Overall, REBNY brokers are more confident in the market today than six months from now, according to the survey called REBNY’s Broker Confidence Index.
The Index is tabulated on a scale of zero to ten with five being neutral. The Overall Present Situation Index, which includes both commercial and residential ratings, rose from 8.87 in the first quarter of 2013 to 9.05 in the second quarter. The increase was largely due to the uptick in confidence for current financing in the commercial sector. The residential brokerage division saw a decline to 8.71 this quarter, down from 9.02 in the first quarter of 2013.
The Commercial Real Estate Market Present Situation Index checked in at 9.28 for the second quarter of 2013, up from 8.85 the previous quarter. Brokers reported that they’re seeing a healthy retail market and brisk activity. Over the next six months, brokers expect prices to rise, as well as interest rates, which could slow the current pace of sales and leasing six months from now.
While commercial brokers are positive about the current market, there is some uncertainty about the market in the next few months. Changing interest rates and the yet to be determined new Chairman of the Federal Reserve Bank are tempering the confidence of the commercial brokers in the market six months from now.
On the residential side, compared to the previous quarter, confidence has slipped slightly, which can be attributed to the low inventory and the emergence of bidding wars among potential buyers. Higher prices and weary clients potentially dropping out of the market are also causes for concern, according to the brokers.
There is a lot of talk about the direction interest rates are headed after an extended period of historic lows, and how an increase in rates, coupled with low inventory levels, will impact the residential market. Although many analysts predict that the rise in interest rates will not impede the housing market recovery, REBNY brokers are expressing a note of caution regarding the market six months from now.
REBNY’s Broker Confidence Index is a collection of data from anonymous online surveys given to REBNY’s residential and commercial brokerage division members.
Go to www.REBNY.com for a full copy of the REBNY Broker Confidence Index.
Loss of Liz Berger
Liz Berger, a longtime lower Manhattan civic leader and friend to REBNY, sadly lost her battle to pancreatic cancer on Aug. 5. REBNY has worked side by side with Liz and the Downtown Alliance for many years, most recently on the recovery efforts after Superstorm Sandy.
Always a consummate professional, Liz fought hard for the Lower Manhattan community she served. Liz will be sorely missed by many in the New York City business and civic community, and especially the local Downtown community, which benefited from her great efforts and passion to help Lower Manhattan become the great neighborhood it is today.
I personally have lost a wonderful partner in representing the real estate and business community. I am thankful I had the pleasure to work alongside her and extend my deepest condolences to Liz’s family in this most difficult time.
In other REBNY News:
Don’t forget whistles and battery or crank-operated radios are needed for NYC Seniors. REBNY’s Residential Brokerage Division partnered with the NYC Department for the Aging for REBNY’s Annual Summer Donation Drive 2013. In the wake of Hurricane Sandy and with the summer heat, the needed crank or battery-operated radios will help keep seniors informed in the event of brownouts and whistles will allow for notification of emergency officials and neighbors during an emergency. Each summer thousands of elderly New Yorkers die in heat waves across the city. Donations will benefit New Dorp Beach Senior Center Friendship Club on Staten Island. Items can be dropped off at the reception area of REBNY, 570 Lexington Avenue, from 11 am to 4 pm Monday to Thursday and from 11 am to 2 pm on Fridays. Please include batteries with the radios. For more information, contact Jeanne Oliver-Taylor at firstname.lastname@example.org.
The industry’s best residential deals are wanted for REBNY’s 25th Anniversary Residential Deal of the Year and Charity Gala. The deadline for submissions is Sept. 12, 2013. Your re-sales, new development sales and rental transactions that have closed or will close between Sept. 14, 2012 and Sept. 12, 2013 are eligible. The prestigious Henry Forster Award and Most Promising Residential Rookie Salesperson of the Year Award will also be announced during the celebration on Oct. 24, 2013 in the Grand Ballroom at The Pierre Hotel, 2 East 61st St. Tickets are $525 per person or $5,000 per table. Corporate sponsorships are still available. For more information, go to www.rebny.com or email Jeanne Oliver-Taylor at email@example.com.