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Home sales experienced their best year in a decade in 2016, but that isn’t giving industry leaders any confidence that housing and the economy are going to improve in 2017, according to the annual 2016 Imprev Thought Leader Real Estate Confidence Survey.
Compared to two years ago, leaders in real estate are much less confident that housing demand will increase; in the latest survey, 35 percent or respondents said they believe there will be more demand for housing next year compared to 47 percent in 2015. Meanwhile, 13 percent said they believe there will be less demand next year—compared to just 6 percent in 2015.
Noting that real estate leaders are “less bullish” about 2017 than they were in 2015, Imprev CEO Renwick Cogdon stated that “Confidence for 2017 is lower across nearly all questions related to housing and the economy.”
Fewer respondents in the latest Imprev survey believe the economy is going to improve in the coming year than they did in recent years; for example, for 2017, 30 percent of respondents said they believe the U.S. economy will improve, compared to 44 percent in 2014. The share of respondents who believe the U.S. economy will deteriorate shot up from 9 percent in 2014 to 23 percent for 2017.
“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,” Cogdon said. “In fact, their confidence grows stronger the closer the economy is to home.”
The share of respondents who are “somewhat confident” in the housing market is down to 74 percent from 79 percent two years ago and the share of respondents who are “not at all confident” in housing for the coming year jumped from 3 percent in 2015 to 5 percent for 2017, with one broker reporting that “Low inventory, slow development and a lack of new home construction” were the reasons behind his lack of optimism, according to Imprev.
But the good news for next year’s housing outlook is that 21 percent of survey respondents said they were “very confident” in the housing market for next year, which represented an increase from 18 percent two years ago, according to Imprev.
For the survey, Imprev polled 240 broker-owners and top executives at leading franchises and independent brokerage firms, a group that covered nearly half of the country’s real estate transactions in 2015.
