NAR: Lifts 2008 Housing Outlook; "...local markets seeing increases"

Posted by urbandigs

Mon Dec 10th, 2007 10:58 AM

A: When will they learn? The NAR, a trade group for real estate agents, said today that the clobbered housing market is on the verge of stabilizing and inched up its outlook for 2007 & 2008 home sales. Um, isn't 2007 pretty much over?

Before I get into what Lawrence Yun said, NAR chief economist, lets check in on the NAR's track record for the past 9 months or so.

The NAR has unsuccessfully predicted housing trends for 70% of 2007! For the past 9 months, count 'em NINE MONTHS, the NAR had to downwardly revise their housing predictions; which were unsurprisingly too bullish. This is the same trade group that was once headed by David Lereah, you remember, the poster boy for 'everything is OK' as the national housing market went into free fall. In Mr. Lereah's own words, "It's a great time to BUY & it's a great time to SELL"! That one was the best. Hmmm, a great time to buy and a great time to sell is what the head of a real estate agent trade group is telling us! Talk about losing credibility as head of a group of people that earn their salaries on transaction commissions.

BubbleMeter's History of Calling out David Lereah

inventory-months-supply-homes.jpgEven Jonathan Miller of MATRIX gets into the NAR groove: NAR's Temporary Housing View

Not a month goes by that Larry doesn’t say housing is getting better and that mortgage problems are temporary:

"Lawrence Yun, NAR chief economist, expected the sluggish performance. "As noted last month, temporary mortgage problems were peaking back in August when many of the sales closed in October were being negotiated. We continue to see the biggest impact in high-cost markets that rely on jumbo loans," he said. “Mortgage availability has improved as evidenced by much lower mortgage interest rates and a sharp jump in FHA endorsements for home purchases."

I was wondering what mortgage data Larry is referring to? I don’t believe its part of his research but is a primary basis of rationalization for glowing market conditions, despite the fact that inventory tracked by NAR is at its highest level since 1985 and has continued to rise despite temporary mortgage problems.

I yearn for the day when NAR finds that perfect moment and decides to inform the public and the consumer what is happening in the housing market, rather than assume we are illiterate. I know many, many brokerage firms and agents that agree with this. PR driven quotes like this don’t move markets so what is there to be afraid of?
It's just so sad, it really is. JM is dead on and I just don't get why the NAR is so afraid to be unbiased and acknowledge what is really going on in the world of real estate. This is one very big reason why real estate agents have a bad reputation!

Anyway, here is what the NAR stated today according to Yahoo Finance:
The revised monthly forecast from the National Association of Realtors, which followed nine straight months of downward revisions, calls for U.S. existing home sales to fall 12.5 percent this year to 5.67 million -- the lowest level since 2002. Last month, the association predicted 5.66 million existing homes would be sold this year. The Realtors' group also forecast sales will rise slightly in 2008 to 5.7 million, up from last month's prediction of 5.69 million.

Numerous other economists, however, are far less optimistic than the trade group. They predict weak sales and falling prices through next year and beyond and emphasize that those problems could worsen if the economy sinks into a recession.
Let us not forget the real data showing delinquencies rising at a faster rate, inventory of unsold homes at record levels, a mortgage market that is in distress, tighter lending standards, and fewer loan options.

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