And you wonder why NAR is suffering a credibility problem?

Look no further than this analysis.

It was great theater. Each month the NAR could be counted on for denial, cheerleading, and blind stupidity. When the NAR ended up with a new, somewhat less-hallucinogenic chief economist, I was actually a bit disappointed.

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  1. Dave Phillips October 1, 2007 at 18:11

    I think the criticism of NAR in the article you linked is a bit unfair. It aint spin if it is true. Now that is not to say David Lereah was particularly perfect. He forcasted a slight downturn in the market for 4 years in a row and each time sales hit a new high.
    It is beyond me that having a “glass is half full” attitude is a bad thing. My predictions of future market have been more accurate than NAR, but even my “half full” predictions were not as positive as the reality of the past 6 years. I’d predict the market would be up 2% and it’d go up 4%. So now that NAR (and me) are saying the market is down, but not out, suddenly we are spinning things? Maybe we are just making our best guess based on the facts. Only time will tell who is correct. My record speaks for itself. I even predicted that the market would peak in 2005 in an article back in 2000. Historically speaking, this will be the 4th highest number of homes sales ever. Are we heading down, yes. Have we hit bottom, probably not, but things should show slight improvement by the end of the 1st quarter.

  2. Matthew Rathbun October 3, 2007 at 00:56

    I am the first to admit that I am not an economist! So maybe my point is not relevant – but I for one am getting drained by all the “crystal ball” watching. Predictions of further growth or decline are much like depending on the weather man to plan a family outing three weeks in advance. We go with our best guess at the time and hope for the best. Me? If it isn’t raining; I am going to go wash my car. If it is…well, I suppose I’ll wait till it stops. I am sooooo tired of caring what everyone else says about what the market is going to do in two to five years. It does not help me pay for feeding the kiddies today. It is the responsibility of each practitioner to go out there and work! Too often agents who were taking orders on floor duty are now whining about the market, instead of going out and working. Many of the “heros” of real estate practice became such in down markets. Is it a matter of glass half full or half empty? Excuse my naivety here, but what does it matter to the individual agent in the big picture? If it wasn’t for the large number of new agents, most of us would not have felt a bump with 2-4% changes in the market. Now those large number of agents are looking for other jobs. I think both Dave the AE and Matthew the Manager would be ok with a 4% drop in membership or office staffing – so why not in the market? The bigger issue is not are we holding our breath for an improving market – but are we properly preparing REALTORS® to go and work with the clients right now and to make a living in the here and now. I know my comments are “worth the paper they are written on” but I can find an article from a “reliable” source for both opinions. It makes neither of them wrong, it simply means at that time and at that place with those factors I can prove or disprove most opinions. I think that NAR, VAR and the local Associations are not helping the singular agent by economic forecasts. There are too many variables and all market’s are local to one extent or another. I’d like to see less of my dues money going to NAR reports and more toward REALTOR education and tools, but I don’t have the big picture – so what do I know?

  3. Jim Duncan October 3, 2007 at 06:40

    Matthew –

    Thanks for stopping by. I agree with you 100% that Associations are doing their members a disservice by putting on their rose-colored-glasses before making these forecasts. When they are proven wrong again and again and again, their (and by proxy, my) credibility is damaged.

    Dave –

    David Lereah killed his credibility methodically, and had a tough job – he was apparently given orders to present a sunny outlook, but now admits that he was wrong.

    Perhaps the most prominent housing booster was David Lereah, the chief economist at the National Association of Realtors until April. In 2005, he published a book titled, “Are You Missing the Real Estate Boom?” In 2006, it was updated and rereleased as “Why the Real Estate Boom Will Not Bust.” This year, Mr. Lereah published a new book, “All Real Estate Is Local.”

    In an interview, Mr. Lereah, now an executive at Move Inc., which operates a real estate Web site, acknowledged he had gotten it wrong, saying he did not fully realize how loose lending standards had become and how quickly they would tighten up again this summer. But he argued that many of his critics have also been proved wrong, because they were bearish as early as 2002.

    From the New York Times.

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