Saskatoon, SK and Vancouver, BC – February 03, 2010 – Forward looking confidence amongst real estate brokers and agents in the United States dropped marginally in January, pushing the national Real Estate Confidence Index (RECI) down to 5.76 on the scale of one to ten (1 “bad” – 10 “good”), or 2.54 percent lower versus the December 2009 reading of 5.91, Point2 Technologies (“Point2″) announced today.
The national RECI, which tracks the forward looking market sentiment of licensed real estate professionals in every U.S. state, dropped for the second month in a row after a record jump of 7.87 percent in November 2009 when the Index hit a record high of 6.03.
All three components that make up the RECI declined in January, versus December 2009.
The Long Term (12 – 18 months) optimism / pessimism variable slipped by 3.09 percent to 6.59 on the one to ten scale. Factoring in the decline, the majority of RECI survey respondents (69.4 percent) remained conservatively optimistic for the long term, rating the component in positive territory, above the 5.0 median.
18.9 percent of the respondents gave the 12 – 18 month outlook component a rating of seven, 17.5 percent gave it a score of 8, and 9.9 percent gave it a score of 9 out of 10. 10.3 percent of the respondents were extremely optimistic and gave the variable the top rating, a 10.
Underscoring relatively stronger expectations for the near term, the Short Term (3 – 6 months) optimism / pessimism RECI component remained virtually flat and came in at 5.88, a -0.68 percent drop versus December 2009.
The third component, the Current Sentiment, slipped back into negative territory to 4.82 (-3.79 percent) on a seasonally adjusted basis, pressuring the overall Index after holding for two consecutive months above the 5.0 median.
A number of respondents to the RECI survey around the country referenced the expanded federal tax credit as a catalyst for potentially good market activity expected through April 30, 2010, underscoring some brokers and agents’ relative reliance on government incentives and, in cases, optimism for the next several months (3 – 6 month outlook). Decreased uncertainty in the market following the expiration of the current federal program is also reflected in the survey results, with the decline of the Long Term optimism / pessimism component of the RECI.
The monthly RECI survey of over 50,000 brokers and agents is conducted by online real estate listing syndication and website solution provider Point2 (www.point2.com) to provide a unique, street level view of the future of the market without dependence, bias or attempt to project into the future using methodologies that leverage past performance data or mathematical projections, applied in most market reports and surveys.
The January 2010 RECI Summary Report including respondent commentaries, presented by state, as well as a state by state RECI score heat map can be accessed at www.RealEstateConfidenceIndex.com.
1613 usable responses were collected and used in determining the RECI for January.
RECI Survey Instrument and Methodology
The Real Estate Confidence Index (RECI) tracks the real estate market opinions of tens of thousands of licensed real estate professionals, brokers and agents, across the United States, accounting for seasonality, on a scale of one to ten (1 being “bad” and 10 being “good”). The RECI also rates respondent sentiment for market conditions 3 – 6 months and 6 – 12 months into the future on a ten-point scale (1 being “pessimistic” and 10 being “optimistic”). The median across all three time periods represents the Index measure for the month.
The RECI is open to the Point2 Agent membership and to tens of thousands of additional licensed real estate professionals across the nation at the beginning of each month. Respondents complete a simple, four question survey through third party survey solution providers, Survey Monkey. The data is tabulated electronically, median averages surfaced for quantitative questions, and qualitative feedback and respondent commentaries are captured and presented in Point2’s monthly RECI Summary Report.
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