These are the results of the Q2 2013 Real Estate Confidence Index survey. In this survey, we asked real estate professionals from across North America how confident they are that their local markets will see improvements in the coming quarter. We were not surprised to find that Realtor® confidence has experienced some gains since last quarter and has improved by leaps and bounds since 2012.
Why should you care about Realtor® confidence and the Real Estate Confidence Index? Consider the following statement from the Real Estate Confidence Index homepage:
“The Real Estate Confidence Index sidesteps [the] shortcomings [of other real estate indices] by tapping the unique knowledge of local real estate professionals to gauge their confidence in their markets in the upcoming quarter. By aggregating the knowledge of many Realtors® in four distinct aspects of their local markets, the Real Estate Confidence Index is able to achieve a broader, more complete perspective than any existing industry index.”
Find additional information about Realtor® confidence in Q2 2013 - as well as the embed codes for the below graphics - on the Real Estate Confidence Index homepage.
Q2 2013 - RECI Survey Results
Largest increases in Realtor® confidence:
- Minneapolis-St. Paul, Minnesota: +18.18%
- Charlotte, North Carolina: +14.86%
- Cleveland, Ohio: 12.16%
Lowest increases in Realtor® confidence:
- San Diego, California: -1.27%
- Los Angeles, California: +1.30%
- New York City, New York: +1.37%
What percentage of Realtors® expect to see improvements in their local markets?
- 87% believe that housing prices will increase.
- 85% believe real estate transactions will increase.
- 74% believe new construction starts will increase.
- 71% believe their local economies will improve.
Regional Realtor® Confidence Breakdown
How does your region’s Realtor® confidence compare to the rest of the U.S.?
The South - The Most Confident Region
Southern real estate professionals are more confident that real estate prices will increase in their local markets than their counterparts in any other region of the U.S. Additionally, they have more confidence that new construction starts and economic growth will occur in their markets than any other region’s Realtors®!
There is an unfortunate disparity in Southern Realtor® confidence, however. Impressive housing market expansions in metropolitan regions like Charlotte are being aided by strong economic growth, something that less fortunate cities like Miami are lacking.
The Midwest - Most Confident in Increased Real Estate Transactions
Midwestern real estate professionals have more confidence that real estate transactions will increase there than Realtors® in any other region of the U.S. The Midwest is also home to the most confident metropolitan region, Minneapolis-St. Paul. Even beleaguered metropolitan regions like Detroit and Cleveland are experiencing large gains in confidence.
The West - Most Confident in Increased Housing Prices
The Western U.S. is home to many of the metropolitan areas, like Phoenix and Las Vegas, that were hit the hardest by the mid-2000s housing market crash. It is thus particularly relieving to learn that Western Realtor® confidence is experiencing gains in everything from housing prices to new construction starts to real estate transactions.
Shadow inventory, which plagued many Western cities affected by the housing market crash for years, also seems to be evaporating. In fact, concerns about low inventory are currently on the minds of half of all Western Realtors®!
The East - Hampered by Slow Economic Growth, Low New Construction
Eastern Realtors® are the least confident that their local real estate markets will improve this quarter. Surprisingly low confidence in new construction and economic growth defined this region’s responses to the Real Estate Confidence Index survey. Regardless, low inventory is rampant on the East coast (like most of the U.S.) and prices are rising or, at worst, holding constant.
Canadian Realtor® Confidence
Canadian real estate professionals are considerably less confident than their American counterparts. Depending on the category, Canadian Realtors® have between 9 and 18 percent less confidence than U.S.
Realtors® that their markets’ housing prices, new construction starts and transactions will increase, though they are equally confident about increases in economic improvements.
Despite these low confidence scores, we were relieved when we calculated them because they are much higher than Canada’s confidence scores from a quarter ago! Rampant fears of overbuilding and overinflated housing prices, combined with the downgrading of six major Canadian banks’ credit ratings, precipitated many industry experts’ predictions that the Canadian real estate market was on the verge of hitting a wall. The 13 percent increase in Canadian Realtor® confidence last quarter seems to indicate that these fears are subsiding and Canada will be able to avoid a catastrophic bubble burst akin to the one the U.S. suffered through.
About the Survey
1,767 real estate professionals took part in the Q2 2013 Real Estate Confidence Index Survey. ActiveRain members comprised 82 percent of the respondents. Two-thirds of respondents work as real estate agents and three-quarters are at least 45 years old.
Top five markets, by number of respondents:
- Phoenix: 102
- New York: 100
- Los Angeles: 98
- Atlanta: 60
- San Francisco: 59
Respondents by region:
- East: 309 (17%)
- Midwest: 228 (13%)
- South: 536 (30%)
- West: 607 (34%)
(Canadian Realtors® and miscellaneous U.S. real estate professionals not included.)
Respondents by industry experience:
- 2 years or less: 129 (8%)
- 3 to 5 years: 208 (12%)
- 6 to 15 years: 816 (49%)
- 16 years or more: 519 (31%)
Respondents by gender:
- Male: 50%
- Female: 50%
Please leave your questions and comments about the survey results and the Real Estate Confidence Index in the comment section below!