NEW YORK CITY—The Real Estate Board of New York's broker members reported a continuing growth in confidence in the first quarter of 2014. The growth in confidence builds on the positive trend going back to the third quarter of 2013. The report also reflects a similar growth in confidence for the market six months from now, according to the REBNY Real Estate Broker Confidence Index.
The first quarter 2014 report showed an increase in the overall confidence indexto 9.21 from 9.00 compared to the last quarter. This jump is due in part to the steadily improving economy as well as the continued increase of home sales in the city's residential market. The overall confidence indexshowed a significant jump from the third quarter 2013 when the Index was 8.75.
“Our brokers—both commercial and residential—continue to express strong confidence in New York City's real estate market,” says Steven Spinola, REBNY president. “The continued uptick in the broker confidence index is a robust sign of our members' faith in the city's steadily improving economy.”
The commercial real estate market overall confidence indexwas an impressive 9.62, up from last quarter's 9.49 and marking a continued positive trend that began in fourth quarter of 2012. Commercial broker confidence for the market six months from now rose slightly as compared to last quarter. This higher level of confidence in the market has been a common view among commercial brokers, and similar to the residential brokers, they are more confident in the current market than they had anticipated. Interest rates continue to be the brokers' biggest concern about the market.
“The important aspects of the retail leasing market are the continued strength of NYC tourism,” responded one commercial broker. “The new availabilities that are coming to market in secondary corridors due to lease expirations, and continued growth in the aspirational sectors of shoe and apparel retailing are the biggest factors affecting the retail leasing market today.”
The residential real estate market overall confidence indexin the first quarter of 2014 was 8.80, a slight increase from last quarter's index of 8.52, and marks the second quarter of a steadily rising overall confidence index. This confidence level is much higher than anticipated in the third quarter 2013 survey when the index for the market six months ahead was 8.19. The residential brokers are equally as confident in the market six months from now.
“In both the rental and sales markets, the competition is high and aggressive,” said one residential broker.
“Last year we didn't have the supply, and this year there is not as much demand as rental prices have exceeded what people are willing to pay,” another residential broker noted.
REBNY's broker confidence index is a collection of data from anonymous online surveys given to REBNY's residential and commercial brokerage division members. Survey data is tabulated on a scale of zero to ten, with five being neutral.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
