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REBNY 1st Quarter 2019 Broker Confidence Index Report
May 29, 2019
The Real Estate Board of New York’s (REBNY) Real Estate Broker Confidence Index for first quarter of 2019 was 6.92 out of 10, an increase of 1.06 since brokers were last surveyed about the fourth quarter of 2018. Residential and commercial broker confidence both experienced substantial increases in the first quarter of 2019 when compared to the previous quarter.
REBNY regularly surveys its residential and commercial brokerage division members to measure their confidence in the New York City real estate market now and six months from now. Survey results are published quarterly with a maximum index of 10.
The Commercial Broker Confidence Index (which focuses only on the Commercial Brokerage Division responses) in the first quarter of 2019 was 7.24, an increase of 0.78 since brokers were surveyed about the fourth quarter of 2018. The Commercial Broker Confidence Index increased by 1.22 year-over-year, up from 6.02 in the first quarter of 2018.
More specifically, commercial brokers’ responses regarding the current assessment of the market (Table 4, Question 1) was indexed at 7.56, an improvement of 0.06 since last surveyed in the fourth quarter of 2018. Similarly, assessments of the current leasing market (Table 4, Question 5) in the first quarter of 2019 demonstrated optimism with an index of 8.89, a 1.48 increase from the fourth quarter of 2018. Despite index improvements, brokers expressed concerns about post-Amazon anti-business sentiments, commercial rent control, rent regulation reforms in Albany, interest rates, and office and retail vacancies. Despite these issues, broker expectations of the commercial market six months from now (Table 4, Question 2) was indexed at 6.74, a 0.68 bump from the fourth quarter of 2018. Nevertheless, the Commercial Broker Future Confidence Index grew to 6.69, a 0.85 increase compared to the previous quarter, fueled by heightened expectations for the financing market (Table 4, Question 4), for which responses rose 0.48, and the leasing market (Table 4, Question 6), which saw an increase of 1.03 when compared to the fourth quarter of 2018.
The Residential Broker Confidence Index (which focuses only on the Residential Brokerage Division responses) in the fourth quarter of 2018 was 6.59, an increase of 1.34 since brokers were surveyed about the fourth quarter of 2018. The Residential Broker Confidence Index increased by 1.05 year-over-year, up from 5.54 when compared to the first quarter of 2018. Renewed confidence assessments of current residential market conditions, as well as the financing and leasing markets, accounted for the increase.
Residential brokers expressed concerns about several policy issues including increases to mansion and transfer taxes, and the loss of the state and local tax deduction, along with concerns regarding inventory surplus, slower activity, and stock market volatility. The Residential Broker Future Confidence Index also increased to 6.56, a 1.05 increase from the fourth quarter of 2018. This increase was attributed to a positive outlook on the future residential market (Table 3, Question 2), financing market (Table 3, Question 4), and rental market (Table 4, Question 6) for which responses saw respective increases of 0.92, 1.56 and 1.71 from the fourth quarter of 2018.