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The real estate industry sits on the precipice of significant changes to MLS practices and client contracts that are set to go into effect later this month.
And for the most part, agents haven’t budged much on the skepticism that they felt in the immediate aftermath of the NAR settlement announcement in mid-March.
General agent negativity toward their potential revenue prospects remained unchanged in late July, and has not meaningfully improved since the NAR deal was announced in mid-March, according to Intel’s Client Pipeline Tracker.
Client Pipeline Tracker level in July: -7
- Previous level: -7 in June
- Recent peak: +7 in January
Chart by Daniel Houston
The Tracker is an updating measure of agent sentiment toward the pool of potential real estate buyers and sellers, powered by the Inman Intel Index monthly survey of real estate professionals.
But while general agent sentiment has remained fairly negative, there are some signs that agents may be less convinced today that the new rules will hurt them with buyers than they were in late March.
This month, Intel goes deeper under the hood, breaking down the main components driving agent sentiment.
Read the takeaways in the report below.
More buyers, little reassurance
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 read the results.
- A rating of 0 represents a neutral period in which client pipelines are neither improving nor worsening.
- A positive score reflects a market in which client pipelines have been improving, or are widely expected to improve in the next 12 months. The higher the rating, the more confident agents are in that conditions are moving in a positive direction.
- A negative score suggests client pipeline conditions are worsening, or are widely expected to get worse in the year to come.
An extremely positive combined score falls somewhere around +20. This type of score would signify that much of the industry is in agreement with the fact that pipelines are improving and will continue to improve.
An extremely negative combined score, on the other hand, falls closer to -20. That’s a bit lower than where the industry stood in September, the first time Intel surveyed agents about their pipelines.
For the four individual components that go into the score, results as high as +50 or as low -50 are sometimes observed.
Here are the component scores for July, and how each one changed from the previous month.
CPT component scores
June → July
- Present buyer pipelines: -35 → -32
- Future buyer pipelines: +2 → +2
- Present seller pipelines: -17 → -17
- Future seller pipelines: +4 → +1
These month-to-month changes reflect the first agent-reported uptick in buyer pipeline activity in six months, potentially an early sign that declining mortgage rates are finally bringing hesitant buyers back to the table.
- The average rate for a 30-year mortgage fell to 6.40 percent on Friday, its lowest point since the spring of 2023, according to Mortgage News Daily.
- This is part of a continued decline from where rates stood in April at 7.44 percent.
Perhaps noteworthy, however, is how agents report that they need to see more before they fully trust that this shift will change their outlook for their future business.
While most agents still believe their buyer pipelines will hold steady or improve in the year to come, a weak summer in terms of existing-home sales may weigh more heavily for some than the very recent uptick in buyer leads.
Also worth noting: The improving mortgage rate environment for buyers — and the hope of upcoming rate cuts by the Fed, potentially as early as September — have yet to give agents meaningful reassurance that they’ll have more listing clients to work with a year from now.
More details on that front below.
What’s actually changed since NAR’s settlement news
The news in mid-March that NAR had reached a settlement that would bring substantial changes to the MLS and buyer and seller contracts had an immediate negative effect on agent sentiment.
Particularly hard-hit? Agents’ outlook for their future buyer pipelines.
- In February, only 15 percent of agent respondents to the Intel Index said they expected their buyer pipelines to grow lighter over the next 12 months.
- By late March, immediately after the settlement news broke, that share had spiked to 28 percent.
Since then, agents have become less bearish on their future buyer pipeline prospects — signaling that maybe some of their worst fears about the settlement impact might not pan out after all.
- In late July, 23 percent of agent respondents expected their buyer pipelines to weaken over the next year.
There have been two other significant shifts in the underlying attitudes about client pipelines.
- Despite the recent reported uptick in potential homebuyer clients, the number of buyers had been steadily slipping. The share of agents reporting lighter buyer pipelines year-over-year in July was 54 percent — up from 45 percent who reported the same in March.
- Declining mortgage rates and looming interest rate cuts have yet to reassure sellers that their listing client pools will improve in the future. The share of agents who expect their listing pipelines to improve next year fell to 29 percent in July, down from 38 percent in March.
In other words, many agents may be less worried about the practical implications of the settlement on their businesses today, but more responsive to weak sales and an extended period of rate-locked sellers.
And even with the positive news with regard to mortgage rates and buyer pipelines in recent weeks, they’ll need more assurances before changing their minds on the market outlook.
Methodology notes: This month’s Inman Intel Index survey was conducted July 22-Aug. 4, 2024, and had received more than 550 responses as of Friday. The numbers used for this article are preliminary and subject to revision. The entire Inman reader community was invited to participate, and a rotating, randomized selection of community members was prompted to participate by email. Users responded to a series of questions related to their self-identified corner of the real estate industry — including real estate agents, brokerage leaders, lenders and proptech entrepreneurs. Results reflect the opinions of the engaged Inman community, which may not always match those of the broader real estate industry. This survey is conducted monthly.
