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Renting in Mass
Joined: 26 Jun 2008
Posts: 381
Location: In a house I bought in December 2011
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 Posted: Fri Oct 23, 2009 6:15 pm GMT Post subject: Existing Home Sales FALL in September 2009 |
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Here's a great counter to the latest NAR spin:
http://www.ritholtz.com/blog/2009/10/existing-home-sales-fall-in-september-09/
Check out the table at the bottom of the post. Not Seasonally Adjusted sales were down 12% in the Northeast! That's pretty amazing considering record low interest rates and the tax credit.
Admin, can you clarify something? Does it make sense to look at non seasonaly adjusted numbers. Adjusting for seasonality makes sense, right? Is the argument that they don't do it correctly? |
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admin
Site Admin
Joined: 14 Jul 2005
Posts: 1826
Location: Greater Boston
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| Posted: Fri Oct 23, 2009 7:36 pm GMT Post subject: Re: Existing Home Sales FALL in September 2009 |
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| Renting in Mass wrote: |
Admin, can you clarify something? Does it make sense to look at non seasonaly adjusted numbers. Adjusting for seasonality makes sense, right? Is the argument that they don't do it correctly? |
I do think it makes sense to look at seasonally adjusted numbers when you are comparing month-over-month changes. I've never attempted to make an argument one way or another regarding whether The NAR is doing it incorrectly. I try to only post year-over-year numbers so that it is a non-issue - usually. The article does make a good point that this year's September is not part of its normal season this year because the pending expiration of the $8K tax credit has effectively extended the normal peak selling season. I would post a link to the article in the news feed, even though I think seasonal adjustment is a good idea, but the profanity might make it a bit unsafe for work for some readers.
This does make me wonder whether The NAR also focuses on the seasonally adjusted numbers when the difference goes the other way. That is, in the spring when the raw month-over-month numbers are increasing but the seasonally adjusted numbers look a lot less strong, which do they promote more? I'm going to go out on a limb here and guess that they aren't consistent (I could be wrong, though).
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Renting in Mass
Joined: 26 Jun 2008
Posts: 381
Location: In a house I bought in December 2011
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john p
Joined: 10 Mar 2006
Posts: 1820
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| Posted: Mon Oct 26, 2009 3:03 pm GMT Post subject: |
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The MAR and NAR seem to report the metric that best suits their agenda. One month they put emphasis on one metric and other months it might be month to month...
I think trying to distill this down you have to look at the nature of buyers and sellers who actually came to the table. People on the sidelines can make noise all they want but it is those on the field that put points on the scoreboard. Statistics are made by those who create transactions (kinetic).
I would try to get data on the pent up demand, versus those that are under financial stress to assess the potential. |
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admin
Site Admin
Joined: 14 Jul 2005
Posts: 1826
Location: Greater Boston
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| Posted: Mon Oct 26, 2009 3:19 pm GMT Post subject: |
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| john p wrote: |
I think trying to distill this down you have to look at the nature of buyers and sellers who actually came to the table. People on the sidelines can make noise all they want but it is those on the field that put points on the scoreboard. Statistics are made by those who create transactions (kinetic).
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That seems like a serious shortcoming of these stats, particularly when sales volume is low. Is the median sale price of a dozen transactions really representative of all home values in a city with tens of thousands of houses? That's not just hypothetical - those are the right orders of magnitude (if I remember correctly) for the numbers in Arlington which The Globe previously obsessed over as proving "immunity" for the town. The differential is even worse for Newton.
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john p
Joined: 10 Mar 2006
Posts: 1820
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| Posted: Mon Oct 26, 2009 4:00 pm GMT Post subject: |
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That's what I'm trying to say, sales volume is slow so the potential (on the sidelines) is what you need to take measure of as well.
The dozen of transactions represents exactly that, a dozen transactions of 24 individuals or so that came to the table and signed on the dotted line.
I think in real estate there is the macro view, the meso view, and the micro view. The micro view matters if you're ready to buy in a very particular area; the rest of the world might behave differently but that doesn't make much of a difference to your desired neighborhood at your desired price point, that is the data that matters to you at that particular time.
Which is why flexibility is such an asset. |
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