With New York City as the national epicenter of the Coronavirus (COVID-19) crisis, it is no surprise that, along with everyone else confronting the current humanitarian crisis, the real estate industry is deeply shaken. During these challenging times, many New Yorkers find themselves out of work and unsure of what New York City’s economic future holds.
The Real Estate Board of New York (REBNY) regularly surveys its residential and commercial brokerage members to measure their confidence in New York City’s real estate market.
REBNY’s Real Estate Broker Confidence Index, the City’s only broker confidence report, benchmarks key data and insights from the real estate industry to track critical economic indicators such as activity from renters and buyers, pricing, and political climates.
REBNY’s Q1 2020 Real Estate Broker Confidence Index found that broker confidence hit an all-time low – 3.72 out of 10.
The overall confidence in the real estate market varied slightly between commercial and residential brokers. Some commercial brokers cited extremely low occupancy as major cause for concern while residential brokers were slightly more confident. However, even amid these unprecedented times, both residential and commercial brokers expressed confidence in the future of the market citing virtual tours, online board interviews and other online resources as valuable tools.
In light of the rapidly changing economic situation due to the Coronavirus pandemic, REBNY tracked broker confidence on a weekly basis in March for our quarterly report to get a real-time sense of broker confidence as the crisis began to unfold and fully take hold of the City. REBNY’s week-by-week analysis, which tracked broker reactions to the federal government’s declaration of a national emergency, New York State’s shelter-in-place executive orders and other emergency measures, all illustrates how the sharp decline in industry and market confidence is directly attributable to the impact of the pandemic.
The 46% decrease in broker confidence since the last survey in the fourth quarter of 2019, should serve as an alert for officials tasked with economic recovery planning. The real estate industry employs hundreds of thousands of New Yorkers – from building service workers to brokers – and generates essential revenue for the City that maintains the salaries of first responders and many other of New York’s most essential workers. Revenue is also used to fund key infrastructure improvements and public services like schools, libraries, and parks.
REBNY will continue to advocate for common-sense solutions to address today’s unprecedented economic challenges head on. With the stay at home order extended until May 15, it is clear that further federal funding and continued efforts to leverage technology to conduct business are going to be essential to the future of New York City’s economic recovery.
The health of the real estate industry is directly tied to the health of the City’s economy and will be essential to economic recovery as we emerge from the Coronavirus crisis. As the real estate industry generated over half of the City’s total annual revenue in the last fiscal year, it is clear that strong policies at the City, State and Federal level are needed to support the key drivers of New York City’s economy.
Download the complete Q1 2020 Quarterly Real Estate Broker Confidence Index here.