The industry’s eternal optimists aren’t putting on a brave face any longer.
As the COVID-19 pandemic ground New York City’s economy to a near-standstill, the Real Estate Board of New York’s quarterly survey measuring broker confidence fell to an all-time low.
REBNY brokers’ overall confidence index fell to 3.72 out of 10, a 46 percent drop from the prior quarter. It’s the lowest value since REBNY began tracking broker sentiment back in 2012.
Given the difficulties in showing properties and transacting, it’s no surprise that broker confidence in the present situation checked in at 2.84. Most brokers don’t think the market will return anywhere close to normal in six months, with confidence for that period at 4.38.
When sentiment was broken out by sector, residential brokers were slightly more positive than commercial brokers.
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Among residential brokers, confusion and a sluggish luxury market before the crisis loomed large, but some respondents pointed to low interest rates and industry’s forced embrace of digital tools as a silver lining.
“Agents are adapting by conducting virtual tours, online board interviews and other online resources that will positively impact the future [housing] market,” one residential broker wrote.
Not everyone was so optimistic, though. “It is impossible to do deals while our businesses are closed, it’s left the real estate market broken,” another residential broker wrote.
Commercial brokers registered a 3.23 level of confidence, down 56 percent from the prior quarter.
“With low to zero occupancy of retail and office spaces, it is very hard to have any confidence in the market,” one commercial respondent noted. “COVID-19 has crushed commercial real estate,” said another.
Write to Erin Hudson at ekh@therealdeal.com