Lawrence Yun in a fit of candor

I don’t mean to pick on the guy, I really don’t; I am honestly grateful and appreciate that he is quoted as saying something blunt and candid. I hope it’s the start of a trend.

The National Association of Realtors reported Thursday that sales of single-family homes fell by 13 percent last year, the biggest decline since a 17.7 percent drop in 1982. The median price of a single-family home fell to $217,800 in 2007, down 1.8 percent from 2006.

It marked the first annual price decline on records that the Realtors have going back to 1968. Lawrence Yun, the Realtor’s chief economist, said it was likely the country has not experienced a decline in home prices for an entire year since the Great Depression.

People want honest, clear analysis of the local real estate market.

For those who read them, whom do you trust more – the NAR, Calculated Risk or The Big Picture (or yours truly for local) for cogent, thorough real estate analysis?

{democracy:9}


Take a look at the aggregate data from the Charlottesville area for the past 5 years – what are your thoughts predictions? (Mine are coming soon)

Sold-In-Charlottesville-Region-2007

Sold-In-Charlottesville-Region-2006
Sold-In-Charlottesville-Region-2005
Sold-in-Charlottesville-region-2004
Sold-In-Charlottesville-Region-2003

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5 Comments

  1. Dave Phillips January 25, 2008 at 16:32

    This is another example of how stats can be misleading. While there is no doubt that prices and sales have fallen, this “crash” is no where near as bad as we have seen in the past and certainly not as bad as the Great Depression. Let’s keep this in perspective… the market rose at the most rapid rate ever for 2 years and then quickly corrected back to earth. The percentage of decline may be the most since the depression, but since it was following the biggest short-term run-up, the numbers are bogus.

    If you want to criticize NAR’s spin, blame them for leading the “there’s no bubble” charge. I helped spread that spin and now I think the charts clearly show a bubble that started in 2004 and has now deflated back to normal. It may not have been a bubble like the dot.com one, but it was a bubble.

  2. Waldo Jaquith January 25, 2008 at 17:45

    I’ve gotten a kick out of the chipper assertions coming from the local real estate industry recently, declaring 2008 will be teh awesome!!!

    Some folks bought a little 3 acre parcel of land next to me recently. It’s in a flood plain, save for the 1/2 acre of mountainside, which a slope of ~25%. It’s worth perhaps $20k as pasture, which is all it’s ever been used for, and what I had planned to do with it. These folks bought it for $80k, which has set folks a-chuckling around Stony Point. It’s worthless for anything other than pasture, what with the 10′ wide, 5′ deep stream-gully running right down the middle of the little ribbon of flat land. They had a major local real estate agency put it on the market. They called today to offer the land. They wanted (drumroll please)…$240k.

    Keep shoveling — there’s a pony in there somewhere!

  3. Jim Duncan January 25, 2008 at 18:03

    If you want to criticize NAR’s spin, blame them for leading the “there’s no bubble” charge. I helped spread that spin and now I think the charts clearly show a bubble that started in 2004 and has now deflated back to normal. It may not have been a bubble like the dot.com one, but it was a bubble.

    I absolutely have criticized NAR’s spin machine Lereah and Yun et al have done tremendous damage to the credibility of ‘boots on the ground’ Realtors around the country. Honest analysis is needed. Certainly not “the sky is falling” statements, but the “fiddling whilst Rome burns” perspective is just too much.

    For example:

    I have long lamented how NAR has missed its golden opportunity to gain the trust of the consumer as being the authority on the housing market, despite the fact that they are a trade group. Rather than leveraging the wealth of information at their disposal, they provided comments like this:

    ‘“Mortgage problems were peaking back in August when many of the September closings were being negotiated, and that slowed sales notably in higher priced areas that rely more on jumbo loans,” he said. “The good news is that mortgage availability has markedly improved in recent weeks with interest rates on jumbo loans falling, and more people are applying for safer and conforming FHA mortgage products.’

    The quote attempts to parse out problems with the mortgage markets from the timing of contract and closing dates. Elements of the statement are correct, but out of context, and ultimately paint an inaccurate picture.

    There’s more affecting the market than “bad headlines.”

  4. Dave Phillips January 25, 2008 at 19:39

    Jim, I did’t mean to suggest that you had failed to point out the bubble. My real point is that you (and many others) disagree when Yun says something positive and agree when he says something negative. He could be right in both cases. I can prove anything with statistics. What we should all look for is balance. As I stated when I posted the year-end report, there is plenty to make you happy or sad, the choice is yours.