The Fed’s decision in September may have given rise to something agents haven’t felt in months: a sense that the tide for buyer pipelines could soon turn, according to the latest Inman Intel Index survey.
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For most real estate agents, not much has changed over the past month as client activity remains low.
For many in the Southeast, the aftermath of a devastating storm changed everything overnight.
But as Federal Reserve officials unveiled a rapid series of moves to lower interest rates, agents across the country grew increasingly hopeful that buyers would return to the table in the coming months, according to Intel’s Client Pipeline Tracker metric.
Client Pipeline Tracker score in September: -5
- Previous score: -8 in August
- Recent peak: +7 in January
Graphics by Daniel Houston
This month’s Tracker metric is based on preliminary responses to the Inman Intel Index survey of real estate professionals from September 18 through October. 3.
Intel outlines the various factors that can provide a glimmer of hope in an otherwise challenging business environment.
Read the full breakdown of the latest Client Pipeline Tracker results in the report below.
At a stasis point
Intel’s Client Pipeline Tracker is a compilation of how agents feel about their buyer and seller pipelines – both over the past year and in the near future.
Intel described the full methodology in this post, but here’s a quick refresher on how to interpret the scores.
- A score of 0 represents a neutral period in which customer pipelines are neither improving nor deteriorating.
- A positive score reflects a market in which the customer pipeline has improved, or is still in progress this is generally expected to improve in the next 12 months. The higher the rating, the more confident agents are that conditions are moving in a positive direction.
- A negative score suggests that conditions in the customer pipeline are, or are, worsening generally expected will become even worse in the coming year.
An extremely positive combined score falls somewhere in the neighborhood +20. This type of score would mean that a large portion of the industry agrees that pipelines are improving and will continue to improve.
An extremely negative combined score, on the other hand, comes closer -20. That’s down slightly from where the industry was in September, the first time Intel questioned agents about its pipelines.
For the four separate components that contribute to the score, the results are as high as +50 or so low -50 are sometimes observed.
Here are the component scores for September and how each sentiment category has changed from the previous month.
CPT component scores
August → September
- Current buyer pipelines: -38 → -38
- Future buyer pipelines: -4 → +7
- Current seller pipelines: -17 → -17
- Future seller pipelines: +7 → +6
We see in the components above that attitudes toward current and future pipeline conditions remain remarkably stable – with one important exception.
Agents became as optimistic about their buyer pipeline for the coming year in September as they have felt at any time since February – a time when economic expectations were still high and the terms of the NAR settlement were not yet known.
But while this optimism for buyers has increased, it remains tempered by current conditions.
- Buyer pipelines in particular remain hard hit 3 in 5 agent respondents in September, Intel told them contemporary buyer pool was thinner than last year at the same time.
- Advertisements were also hard to find. Almost 45 percent of the agents who participated in the September survey reported their pipelines were lighter than the same time last year, compared to 23 percent who said they were heavier.
Looking ahead, officers have begun to sing a new hopeful tune in recent weeks — albeit with a healthy dose of caution.
A shot in the arm
The real estate sector had been waiting for the signals all year.
Brokerage leaders and rank-and-file agents alike knew that their hopes for a healthier sales environment depended on how quickly — and how soon — the Fed could cut rates this year after its long battle with price inflation.
And at the beginning of the year there was great hope that an interest rate cut would come as early as the spring.
But as new inflation data put those hopes on hold, agents’ prospects for their own business prospects sank.
In September, however, they finally got what they wanted: the Fed’s pledge that the fight against inflation would end, and a new round of rate cuts that could draw more consumers back to the market.
And this development – more so than even the falling mortgage rates of the previous weeks – coincided with the biggest positive shift in buyer pipeline agent attitudes in months.
- 41 percent of the agent respondents Intel told in September that it expected its buyer pipelines to be heavier than before within 12 months 31 percent who said the same thing the month before.
- Only 22 percent of agent respondents said in September that they believe their buyer pipelines will get lighter in the coming year 29 percent in August.
As with any monthly shift of this nature, it will be important to wait for future studies to confirm whether this is the first step in a broader shift, or a blip. Intel will continue to monitor these developments closely.
Methodological notes: This month’s Inman Intel Index questionnaire was conducted from September 18 to October. August 4, 2024, and had received 439 responses by the end of Thursday. The figures used for this article are preliminary and subject to revision. The entire Inman reader community was invited to participate, and a rotating, random selection of community members were asked to participate by email.. Users responded to a series of questions related to their self-described corner of the real estate industry – including real estate agents, brokerage leaders, lenders and proptech entrepreneurs. The results reflect the views of the involved Inman community, which do not always reflect those of the wider real estate industry. This questionnaire is carried out monthly.
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