RISMEDIA, October 16, 2009—Point2 Technologies Inc. (“Point2”) released the results of its forward looking Real Estate Confidence Index (RECI) for the United States for the month of September 2009, reporting a reading of 5.8 on the RECI scale of 1-10 (1 being “Bad” and 10 being Good”), compared to 5.9 for August 2009. The RECI remained virtually flat at a national level, slipping less than one percentage point.
The RECI tracks Current market sentiment, Short-Term (3-6 months) Optimism/Pessimism and Long-Term (12-18 months) Optimism/Pessimism of real estate professionals in the United States. The median across all three time periods represents the forward looking Index measure for the month.
Real estate professionals’ Current sentiment averaged 5.06 on a seasonally adjusted basis, up from 4.96 in August. The change represents a 2% improvement in confidence across the country. However, the forward looking Short Term (3-6 months) Optimism Pessimism reading came in at 5.70, slipping 1.7%. Long Term (12-18 months) Optimism/Pessimism was also off its recent high, dropping by 2.3% versus last month and further pressuring the Index’s overall score.
Bank owned properties (REOs) and low priced foreclosures combined with the U.S. $8,000 First-Time Buyer Tax Credit were frequently credited by RECI survey respondents for spurring much of the market activity in the study period. Foreclosures and REOs were however also cited as a primary cause for continued downward pressure on the market.
Other positive catalysts linked to the recent buying activity include low interest rates. General concerns reported by survey respondents include the Federal Tax Credit program nearing its expiry on November 30, 2009, persistent high REO and foreclosure inventories, a weak employment picture and a continued tough financing environment. Tough appraisals, which tend to derail deals, and sporadic sentiment that more foreclosures are being held back were also mentioned by respondents in several states.
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