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REBNY Confidence Index: NYC Real Estate Brokers Report Increase in Confidence in First Quarter 2014
May 1, 2014
-- Quarterly survey of brokers shows continued positive trend in broker confidence
The Real Estate Board of New York broker members reported a continuing growth in confidence in the first quarter of 2014. This growth in confidence continues a positive trend going back to the third quarter of 2013. The report also reflects a similar growth in confidence in the market six months from now, according to the Real Estate Board of New York’s (REBNY’s) Real Estate Broker Confidence Index released today.
The first quarter 2014 report recorded an increase in the Overall Confidence Index to 9.21 from 9.00 compared to the last quarter. This jump is due in part to our steadily improving economy as well as the continuing increase of home sales in the city’s residential market. The Overall Confidence Index showed a significant jump from the third quarter 2013 when the Index was 8.75.
“Our brokers—both residential and commercial--continue to express strong confidence in New York City’s real estate market,” said Steven Spinola, REBNY President. “Our continuing increase in the Broker Confidence Index is a strong sign of our member’s faith in our city’s steadily improving economy.”
The Residential Real Estate Market Overall Confidence Index in the first quarter of 2014 was 8.80, a slight increase from last quarter’s index of 8.52. This increase marks the second quarter of a steadily rising Overall Confidence Index. The residential brokers are equally confident in the market six months from now. This confidence level in the market today is much higher than our residential brokers anticipated in the third quarter 2013 survey when the index for the market six month from the third quarter survey was 8.19. This improvement above what was anticipated illustrates a higher level of confidence than what brokers expected six months ago.
“Last year, we didn’t have the supply, and this year there is not as much demand as rental prices have exceeded what people are willing to pay,” said one residential broker.
The Commercial Real Estate Market Overall Confidence Index was an impressive 9.62, up from last quarter’s 9.49 and marking a continued positive trend that began in fourth quarter 2012. Commercial Broker confidence for the market six months from now rose slightly compared to last quarter. This higher level of confidence in the future market has been a common view of the commercial brokers lately, and as with the residential brokers, the commercial brokers are more confident in the current market than they had anticipated, and they continue to cite interest rates as their biggest concern about the market.
“The important aspects of the retail leasing market are the continued strength of NYC tourism,” responded one commercial broker. “The new availabilities that are coming to market in secondary corridors due to lease expirations, and continued growth in the aspirational sectors of shoe and apparel retailing are the biggest factors affecting the retail leasing market today.
REBNY’s Broker Confidence Index is a collection of data from anonymous online surveys given to REBNY’s residential and commercial brokerage division members. Survey data is tabulated on a scale of zero to ten, with five being neutral.