What a shame that we have to spend so much time and effort on- and off-line answering the National Association of Realtors’ economist’s “predictions.” Noah is spot on:
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.
Thank goodness for local real estate blogs to provide cogent, pertinent analysis. The credibility of the NAR’s economist is whittled away every day by himself and real analyses. Here is the most recent “forecast.”
As the CR says:
I think their forecasting model is broken.
Where is the harm is providing honest, clear information? There are always different ways to spin information, and it’s understandable that the NAR (and part of me thanks them for this) wants to present the information in the best possible light. But do they have to do it in such as way that the reaction is one of laughter, smirks and a shakes of the head?
The question is – does the NAR’s economist have either credibility or relevance on which to trade?
*note that this is not a personal attack on the man, but the office’s “predictions” and track record.
Update 11 December 2007: A point of clarification based on an off-line conversation. The market is not the media’s fault. The media plays a significant role, as does the NAR. The NAR has, and should recognize, their potential to build credibility for themselves and their members by being the trusted source of information, rather than being perceived as saying whatever it takes to increase transactions.
With many families affected by resetting interest rates on subprime mortgages and the ongoing rise in foreclosures, NAR has been working to help more homeowners and their families keep their homes. “Clearly it is unfair to tax people on phantom income when they most likely have no cash with which to pay that tax,” said Combs. “Realtors® don’t just sell homes; we build communities, and NAR is committed to efforts that will help make the nightmare of losing a home less burdensome for families.”
The current tax code requires a lender who forgives debt to provide a Form 1099 to the IRS stating the amount the borrower has been forgiven. This disclosure applies whether a short sale, foreclosure, deed in lieu of foreclosure or any similar arrangement relieves the borrower of the obligation to pay some portion of his or her debt. If the property is sold at foreclosure or is sold for less than the amount borrowed, that difference is considered income and is subject to the tax.
Update #2 11 December 2007:
I’m not the only one who thinks that NAR’s credibility is at stake/gone:
Among the best comments I’ve read:
I would think realtors would want to be informed as well. As the lone voice of prosperity when there is absolutely no cause for it, the NAR only serves to remove itself from revelance. I am surprised news wires even bother to pick up their forecasts any more.