NYC commercial and residential brokers are split on market outlook
REBNY’s quarterly survey shows commercial brokers’ confidence sinking to new low, while residential brokers express more optimism
New York’s commercial brokers are all doom and gloom.
Commercial brokers scored their present confidence in the Big Apple at 0.89 out of 10, according to the Real Estate Board of New York’s second-quarter sentiment survey. That marked a 66 percent drop compared to the first quarter, and an 89 percent drop year-over-year.
When it comes to REBNY’s future confidence index, which considers brokers’ views on the market six months ahead, commercial brokers were also negative. Looking ahead, they scored their confidence 2.72 out of 10, a 26 percent drop from Q1 and 58 percent year-over-year decline.
Those surveyed cited a laundry list of reasons for their dim outlook. They included the inability to cold-call potential clients, a a drop in tourism and consumer spending, and “political unrest and lack of coherent policy from the federal government.” Other notable responses included the condition of public transit and uncertainty about reopening schools.
New York City residential brokers, meanwhile, are more optimistic.
Residential brokers’ confidence in the current market increased in the second quarter. They rated their confidence level 4.06 out of 10, up 32 percent compared to the first quarter, when the pandemic was intensifying. Their year-over-year confidence declined 41 percent, however.
The future index ticked up less than a point to 5.11among residential brokers, compared to the first quarter. The number was about 10 percent below what it was at the same period in 2019. Residential brokers cited increased interest in renting units with outdoor space as a bright spot from April through June, though others pointed to concerns about Covid-prompted flight to the suburbs, along with pricing uncertainty and financial impediments on the sales side.
Despite residential brokers’ sunnier disposition, commercial brokers drove REBNY’s combined confidence index down in Q2. The composite index, which measures both commercial and residential brokers’ sentiment today and in the future, fell to 3.30 out of 10, a drop of 11 percent compared to the first quarter. That marked an all-time low, since REBNY began tracking market sentiment in 2012. The second quarter combined data was also a 50 percent year-over-year drop.
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