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Worry lines put a crack in broker confidence this quarter
December 3, 2014
By Steven Spinola
REBNY recently released its third quarter 2014 Broker Confidence Index, which saw a slight decrease in both residential and commercial brokers’ confidence in the current market.
Overall broker confidence has slipped since the beginning of 2014. However, it should be noted that confidence levels have not dropped below 8.80 in 2014.
The Residential Broker Confidence Index dipped to 8.23 from 8.30, which, interestingly, is the same level it was exactly one year ago during the third quarter of 2013.
As in previous years, residential brokers have cited a lack of inventory as one of the reasons for concern in the market, particularly middle income housing.
Also, despite the continuous increase in price, buyers are remaining cautious and sellers are being careful with pricing outside of perennial “hot” neighborhoods.
Although there is an abundance of new ultra high end developments going up around Manhattan, the popularity of the new neighborhoods in the outer boroughs was a more positive factor in the market for our residential brokers.
Most new development in Manhattan is forcused on luxury development. Lavish living here extends to properties like One57 where the penthouse was sold for more than $90 million.
The Commercial Broker Confidence Index also took a slight dip this quarter, from 9.45 to 9.38. Despite this, Commercial Broker confidence levels have remained well above 9.0 since the first quarter of 2013, and third quarter Confidence levels were much higher than brokers predicted they would be three months ago.
Brokers reported that investment activity has been gaining strength since the last half of 2013, and that demand is still strong despite a tightening of supply.
REBNY also released its Residential Sales Report for the 3rd quarter of 2014, which reported rising prices and diminishing sales volume.
The average price of a home in NYC rose to $910,000, up 13% from last year’s third quarter of $806,000. This rise in average price can be attributed to price increases in Manhattan, Brooklyn, and Queens, and the total consideration for all residential sales in New York City during the third quarter of 2014 was $10.9 billion.
Manhattan neighborhoods with the most home sales this quarter were the Upper East Side (829 sales), Upper West Side (695), and Gramercy/Kips Bay (304). Brooklyn residential home sales activity was focused in Bedford Stuyvesant (193), Bay Ridge/Fort Hamilton (165), and Park Slope (165).
Queens neighborhoods with the most home sales were Rego Park/Forest Hills/Kew Gardens (375 sales), Flushing (320), and Jackson Heights/Elmhurst (282), and Bronx neighborhoods with the most residential home sales were Riverdale/Fieldston (116), City Island/Pelham Bay, PelhamStrip/Country Club/Throgs Neck/Schuylerville (94), and Parkchester/Westchester Square/Castle Hill/Soundview (92).
Every quarter, the broker confidence in the New York City real estate market has generally remained strong. Residential and commercial brokers alike both understand the desirability of our city as a place to live, work, and visit, and because of this, the market continues to perform exceedingly well regardless of recent economic conditions.
As brokers continue to find supply to meet high consumer demand, retaining the confidence and trust of buyers will continue to be a key element going into 2015.
In other REBNY news:
December 11 between 5:45 and 7:30 is the Residential Annual Meeting, taking place at the Bank of America at One Bryant Park. Registration is required, and the meeting is open to REBNY Residential Principal and Managing members. For more information, contact REBNYResidentialEvents@REBNY.com.
December 12 from 9:15 a.m. to 11 a.m. is our Residential Brooklyn Seminar at St. Francis College. Located in Founders Hall, this seminar is called “How to Become a Million Dollar Producer,” and seating is limited to 200. For more information, contact REBNYResidentialEvents@REBNY.com.
December 16 from 12 p.m. to 2 p.m. is REBNY’s Commercial Holiday Luncheon at the Waldorf Hotel. The luncheon is hosted by the Commercial Brooklyn, Building Agents Rental, Midtown South, Lower Manhattan, Leasing, Midtown West/Penn Plaza, Plaza, Grand Central, Real Estate Finance, Retail, and Sales Brokers committees. For more information on registering visit REBNY.com or contact Desiree Jones at DJones@rebny.com.
January 15 is REBNY’s 119th Annual Banquet from 7 p.m. to 10 p.m. at the New York Hilton.