Brokers Share Their 2017 Outlook
December 8, 2016
Top real estate executives are feeling less bullish about the coming year than they were two years ago. Their concerns are growing over agent productivity and they’re feeling more pressure surrounding profitability prospects, according to the latest Imprev Thought Leader Real Estate Confidence study of nearly 240 broker-owners and top executives at leading franchises and independent brokerages.
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Thirty-five percent of respondents believe housing demand will improve in 2017, down from the 47 percent who felt that way about the market in 2015. Still, 74 percent of real estate executives and broker-owners say they’re “somewhat confident” in the housing market for 2017.
One broker-owner of a major franchise office who took part in the survey said there are three reasons for his tempered enthusiasm heading into 2017: “Low inventory, slow development, and a lack of new home construction.”
Thirty-nine percent of real estate leaders say they are confident about greater profitability in 2017, down from 43 percent two years ago. Rising costs remain a top concern. “It’s about expenses versus shrinking profits,” one regional broker owner who runs an office of more than 1,000 agent wrote in response to the survey. Twelve percent of real estate leaders surveyed said they are “not at all confident” that their brokerage business will be more profitable next year – which is more than double the percentage who said that in 2015 (when it was 5 percent).
Broker confidence is more subdued because of a growing negative outlook about the economy, the survey shows. But there’s a silver-lining: “When we compare past studies, an interesting trend emerges: Executives and broker-owners are less confident in the global economy and far more confident in their local economies at the end of each year than they were at the beginning,” says Renwick Congdon, CEO of Imprev, an automated marketing service for real estate. “In fact, their confidence grows stronger the closer the economy is to home. This year, while only 4 percent of leaders say their confidence in the world economy has grown this year, 35 percent say their confidence in their own local economy has grown; while 13 percent have gained confidence in the U.S. economy, 26 percent have more confidence in their own state’s economy.”
Updated: June 22, 2018