R
eal estate investor sentiment has seen a significant boost, with the latest Investor Sentiment Index up 8 points from the previous quarter. The index, compiled by RCN Capital and CJ Patrick Company, gauges investor attitudes through four key questions.

    Investors are optimistic about current conditions, with 68% viewing today's market as better or much better than it was a year ago. This represents an 8 percentage point increase from the last report in July. Conversely, only 13% believe the market is worse or much worse, down from 20% quarter-over-quarter.

    Looking ahead, 71% of investors expect conditions to improve over the next six months, marking the highest share of positive responses since the index's inception. Just 9% anticipate a decline in conditions, a series low.

    "Sentiment has nearly doubled compared to last year," said RCN Capital CEO Jeffrey Tesch. "Investors are reacting to improving market dynamics, including declining financing costs and rising inventory."

    Most investors believe home prices will continue to grow, with 70.6% of respondents expecting an uptick in prices. Home flippers are particularly bullish, with over 80% seeing improved market conditions over the past year and over 83% anticipating further improvement.

    However, rental property investors remain more cautious, with only 47% viewing current market conditions as better than last year. Despite this, their sentiment is trending upward, with a 12 percentage point increase from July.

    Interestingly, while home flippers are more optimistic about the economy, they also expect a recession to materialize in 2024 at a higher rate (74.7%) compared to rental investors (38.7%).