Are The Realtors Wrong?
Are The Realtors Wrong?
CoreLogic released its latest report this week. And the numbers seem to tell quite a different story from the one we’ve been hearing from the Realtors.
CoreLogic says that the Realtors numbers “could be understating bad news while inflating not-so-bad news by 15 to 20 percent,” as Alan Abelson put it in this week’s Barron’s.
The Realtors say that home sales dipped to 4.9 million or a decline of 5 percent. CoreLogic says home sales dipped to 3.6 million, or a far bigger decline. Since the Realtors aren’t out there counting every sale, it’s hard to know if their numbers are right. (It’s how I feel about how the Government collects the unemployment data, but I digress.)
The Realtors say that the number of homes in inventory (listed but not sold) is 9 months. CoreLogic says it’s more like 16 months. A “normal” market is about 6 to 7 months of unsold inventory. Again, that’s a pretty huge difference.
CoreLogic says it home sales and home inventory numbers were very similar to the Realtors until 2006, when they began to diverge.
So what happened? Are the Realtors’ surveys are purposefully undercounting negative news and overcounting what passes for “positive news these days. They certainly have motive enough for undercounting or understating the bad news. After all, it they provide worse numbers, then folks might give up being Realtors and stop paying dues to the organization. (I’m such a cynic.)
Could the Realtors be wrong about what’s going on in the housing market? And, if so, what does that really say about the state of housing in the US right now?
As I’ve been saying for awhile, this recession is only over for folks in Washington, D.C. and those who live on Wall Street. I’m not so sure that the recession is over for those who live on Main Street.
What do you think is going on? What’s happening in your neighborhood?
We took a call from a woman today on the show who said that home sales had fallen back to the level they were at in 2000. She’s not seeing move-up buyers (who don’t have any equity, or not much equity). She’s seeing people who have to move because of a life-cycle event: marriage, death, new job. It’s a low level of sales.
Is that what’s going on in your neck of the woods?
This Week on the Equifax Personal Finance Blog
So, it’s all about taxes, right? Next week, we’re going to do a tax show with our tax experts. I asked everyone to think about their tax questions. One listener already sent me his tax question.
In the meantime, Eva Rosenberg, an enrolled agent, has written some fabulous tax articles on the Equifax Personal Finance Blog. Here’s her latest, and be sure to click through and check out the others.
Tune in next week for our tax show.