span Sure, on occasion the
class="cap">H aving forecasts may provide a
been a member of the milk-toast opinion of possible
National Association of Realtors market slowing. This is so rare
(NAR) for three decades, I cannot and so wishy-washy as to be
recall the Association forecast laughable. The real estate-buying
being anything but overly public is becoming much more
optimistic. I'm also a member of sophisticated and it's my opinion
the San Diego Association of that the constant overly
Realtors and the California optimistic outlook of the
Association of Realtors; the same National Association of Realtors
holds true for their forcasts. is making the association and all
I believe Realtor associations its members look foolish to say
serve a noble purpose, but I do the least.
have a problem with these In February of 2005, then NAR
associations putting out an chief economist Mr. Lereah
economic forecast. How can any published a book titled: “Are you
forecast done by an economist who missing the real estate boom? The
is an employee of trade boom will not bust and why
associations whose membership is property values will continue to
based on real estate sales, climb through the end of the
possibly put out an accurate decade — and how to profit from
forecast for real estate trends them.” Shortly after the
if those trends are anything publication of this book, many
other than positive. So is the real estate markets including San
association actually enhancing Diego's, took a distinct downward
the image of the Realtor by trend which has continued through
giving accurate guidance to the to today. NAR’s December 2005
general public by issuing forecast for 2006 said existing
continual rosy forecasts?
home sales would fall 3.7% and
new home sales would fall by forecast? For 2008, the NAR is
4.8%. It appears the facts were projecting existing home sales
so overwhelming, NAR could not will increase very slightly, and
issue a postive forecast, so they the median home price should also
issued the mildest 'soft' market increase. Also predicted is that
report possible. If the general new home sales will continue to
public relied on this report, fall sharply in the range of
they would have been served very about a 12% drop. In the report
poorly. The data released in NAR speculates that for the
December 2006, actually showed largest part of the market,
existing home sales fell 8.6%, existing home sales, the bottom
more than twice the NAR forecast. has come, and 2008 will be a
Plus, new home sales fell 17.8%, turning point.
which was almost 4 times more
Based on their last two yearly
than the NAR predicted.
forecasts, is the NAR's 2008
In December 2006 the chief projection, accurate? With the
economist for the NAR said: “Most Fed dropping interest rates hand
of the correction in home prices over fist, I think there is a
is behind us, but general gains 50-50 possibility that finally
in value next year will be modest NAR’s projection may be close to
by historical standards.” It was reality. If the housing market
said in this report that existing numbers for 2008 come anywhere
home sales were expected to be close to NAR’s projection, will
off 1% and new home sales to fall it vindicate the necessity for
9.4%. What actually occurred for the association having an
2007 was that existing home sales economist on staff? To me it's
took a fall of 12.3%, and not the kind of like a broken clock; it
1% estimated by the NAR. New home will be correct at least twice
sales were down about 25%.
during a 24-hour period.
What is the latest NAR
I believe the NAR should leave
the forecasts up to the margin-top: 5px; margin-bottom:
government and the Wall Street 10px;" valign="top"
economists and just report the align="center">
actual housing numbers. Let's
face it; it's not always a good
time to buy real estate. Let's type="text/javascript">
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Article Tags: home, nar, sales
