New REBNY Report Shows Broker Confidence Slipping Into Negative Territory For First Time Since 2020

Even as Residential Market Remains Dynamic and Retail Recovery Intensifies, Brokers Are Concerned About Economic Challenges Such as Interest Rates and Inflation 

NEW YORK, NY – The Real Estate Board of New York (REBNY) today reported that confidence among the city’s real estate brokers fell into negative territory for the first time since 2020.

The decline noted in REBNY’s Q2 2022 Real Estate Broker Confidence Index was largely driven by broader economic concerns, including interest rate increases, rising inflation, and uncertainty about the path of the economy, rather than underlying concerns about New York City as a place to do business.

The Current Confidence Index (CCI) among residential brokers fell to -1.74, down from 31.41 in Q1 2022. The CCI among commercial brokers fell to -37.72, down from 17.05 in Q1 2022. The last time both Residential and Commercial CCI fell into the negative was 2020, during the heart of the pandemic, when Residential CCI hit –24.71 in Q3 and commercial sentiment fell to –64.32 in Q2.

In comments, residential and commercial brokers agreed that broad economic factors account for the drop in sentiment. Residential brokers were more likely to name interest rate hikes as their chief concern, while nearly half of commercial brokers pointed the finger at inflation and economic uncertainty.

Even with these very real concerns, real estate activity in New York City has continued at a healthy pace. So far, mortgage rate increases have not dramatically impacted property sales as total sales through June have outpaced totals from the first six months of 2021. The quarter also displayed the continued competition for rental apartments in a very tight market.

While commercial brokers have expressed concern about the broader economy, the retail and hospitality sectors have surged thanks to robust tourism. In the office sector, businesses are still committing to the highest-caliber office space, and market indicators have been incrementally improving. Significant recent transactions like Clayton Dubilier & Rice’s expansion within the Seagram Building and the Macquarie Group’s relocation to Brookfield’s 660 Fifth Avenue demonstrate steady leasing activity over the last quarter, particularly with Class-A properties.  

Even with positive momentum for both residential and commercial sectors of late, responses for REBNY’s Six-month Expectations Index (EXI) from brokers were negative, as the residential EXI fell to -10.07 EXI and the commercial EXI fell to -34.87 EXI.

The findings of this report continue to indicate the need for State and City policymakers to focus on steps to support New York City’s economic recovery. With New York City real estate generating more than half of the City’s annual tax revenue, the health of the real estate sector continues to be inextricably linked to the health of New York City. 

Top issues that brokers mention as important to sustaining New York’s economic momentum include:

  • a more substantial and sustained return to the office 

  • local government and incentives that support businesses 

  • more clarity on licensing and permitting oversight as City agencies undergo change 

  • avoiding additional fees and taxes at a time when operating costs are spiking  

  • resolving quality-of-life issues (crime, sanitation, and transit)

“Despite continued strength in the residential sales and leasing market and the faster-than-expected acceleration in retail and hospitality, brokers expressed clear concerns regarding the direction of the overall economy moving forward,” said REBNY Director of Market Data Keith DeCoster. “While the real estate sector has been helping to propel the city forward, it remains to be seen how much rising interest rates, coupled with elevated costs, will dampen these positive trends."

“While the current higher interest environment is creating a level of uncertainty and challenging investors looking to price deals, the silver lining has been the robust momentum of the residential rental market,” said Ofer Cohen, Founder & CEO of TerraCRG. “In addition, the development project pipeline induced by the 421a deadline will provide a wave of capital market transactions in the 2nd half of 2022.”

“Luxury retailers are experiencing a strong recovery, but more traditional apparel, shoes and accessories tenants have not returned to pre-Covid sales levels, partially due to fewer daytime commuters,” noted Stephen J. Stephanou, Principal of Crown Retail Services. “While food and beverage tenants are feeling a bit more optimistic, the headwinds of inflation and labor challenges have slowed the expansion of their real estate footprints. All this said, some deals are being made.”

Download the complete Q2 2022 Quarterly Real Estate Broker Confidence Index here.

For more information about REBNY research reports, visit

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