Rising interest rates and a volatile global economy still have New York real estate brokers a smidge worried.
Commercial brokers appear to be the more concerned of the bunch, with their confidence index dropping to 7.88 in the fourth quarter of 2015 from 8.85 last quarter, according to the Real Estate Board of New York’s latest broker confidence index report. The overall broker confidence index fell .3 points to 7.87 in the fourth quarter of 2015.
This is the fourth consecutive quarter that overall broker confidence has slipped — driven by the Federal Reserve’s decision in December to raise short-term interest rates for the first time in 2008. Another increase is rumored for March.
“Our brokers are mindful of the potential impact of increased interest rates on future business decisions and questioning the sustainability of this extremely long and generous market cycle,” John Banks, REBNY president, said in a statement.
Meanwhile, things are slightly rosier on the residential side. Confidence actually rose to 7.85 from 7.83 the last quarter. The increase, however, was tempered by an expected market slowdown, due in part to a lack of overall inventory and a saturation of ultra-luxury properties. Some brokers fear that the rise in interest rates will slow down the rate of growth in price sales.