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REBNY 4th Quarter 2016 Broker Confidence Index Report
March 15, 2017
The Real Estate Board of New York’s (REBNY) Real Estate Broker Confidence Index for the fourth quarter of 2016 was 6.00, a 0.21 increase from the third quarter of 2016. The Broker Confidence Index rose for the first time since the fourth quarter of 2014.
The Future Confidence Index, which measures broker confidence in the market six months from now, swung upward to 5.97 from 5.29, also notching the first increase to the Future Index since the fourth quarter of 2014. This increase in the Future Index propelled the rise in the Broker Confidence Index in the fourth quarter of 2016. Both Residential and Commercial brokers expressed stronger future market prospects in the survey.
The Commercial Broker Confidence Index was 5.85, an increase of 0.64 since the third quarter of 2016. The Commercial Broker Confidence Index rose for the first time since the fourth quarter of 2014. The Commercial Broker Future Confidence Index rose by 1.07 in the third quarter of 2016 to 5.39 in the fourth quarter of 2016. Commercial brokers are more confident in the market now and in the future, than they were last quarter. Concerns about our country’s political future and central bank movements have continued to influence the outlook of commercial brokers. Some voiced unease about availability of financing and rising interest rates. However, these concerns have not tempered their confidence in the market.
Our Residential Broker Confidence Index was 6.14, down 0.23 since the third quarter of 2016. The Residential Broker Future Confidence Index rose 0.28 to 6.54. The residential brokers’ concern about current market conditions has diminished their confidence in the near term. However, they remain positive in the market six months from now.
In a similar vein to last quarter, residential brokers’ concerns in the current market and the market six months from now included the softening of the rental market. Numerous brokers worried about oversupply of apartments, highlighting that luxury condominiums and rental units have caused price softening in those categories. Brokers with international clients expressed unease about the market climate under a new president. Additionally, multiple residential brokers bemoaned unrealistic seller expectations. One residential broker commented, “This is not a market to ‘try’ a price.”