After hitting all-time lows in the middle of 2020, broker confidence is rebounding, according to the Real Estate Board of New York’s latest quarterly survey of industry professionals.
Overall, REBNY’s broker confidence index was at 4.35 out of 10 in the fourth quarter of 2020, a 41 percent increase from the low point of 3.08 in the previous quarter. While that’s a notable improvement, it’s still a sharp decrease from the same period in 2019, when the index was at 6.87.
“Broker confidence rebounding at the end of 2020 illustrates that the industry has an increasingly positive view that we can overcome the immediate challenges we face, including vaccinating all New Yorkers, getting New Yorkers back to work and boosting our economy,” REBNY president James Whelan said in a statement. He cited the need for more rapid testing and a speedier vaccination roll-out as crucial to getting the market back to normal.
While brokers are generally feeling more optimistic, there are differences in the commercial and residential sectors. Overall commercial broker confidence remains quite low, at 2.89 out of 10, a 60 percent drop from the same time last year.
And while brokers’ confidence in the market six months from now has improved slightly — the index is at 3.68, compared to 2.72 in the previous quarter — there are still issues that keep them from feeling too optimistic.
“There are too many moving variables at the moment — Covid, economic recovery, stimulus, NYC elections — to have any confidence in the market performance,” one commercial broker told REBNY. The slow vaccine rollout in New York, eviction moratoriums and the sluggish retail market were problems cited by other brokers.
Residential brokers, in comparison, are feeling better about the state of the sector. The confidence index for residential agents is at 5.81, which is only a 20 percent decline from the same period in 2019. And residential brokers are feeling more confident about the market six months from now; that index is at 6.45, a 50 percent jump from the previous quarter.
“There has been a spike in activity over the past few weeks, where the reasonably well-priced properties that have been sitting are now seeing significant activity and even getting multiple offers,” one residential broker told REBNY. “There seems to be a sense that the worst is over, and that things will begin to improve in the market over the coming months.”