Housing Perspective: June Existing Home Sales
Lies, damn lies and (NAR) statistics.
Indeed.
The National Association of Realtors (or NAR) released data today showing that sales of existing homes crept up in June, the 3rd consecutive up month. While sales were a touch lower than they were a year ago, the annualized, seasonally adjusted sale figure was up 3.6% from May. (For more on seasonal adjustments, please read The Magic of Seasonal Adjustments)
This positive data led many pundits and so-called experts to reiterate calls for a bottom in the broad housing market. “We have finally bottommed out,” Stuart Hoffman, chief econmist at PNC Financial Services told Bloomberg. Hoffman was referring to sales, not necessarily prices, but conventional widsom says that prices follow volume.
Others, like the popular economics blog Calculated Risk, did some actual analysis of the data and came to a different conclusion about the fundamentals of the market:
“It’s important to note that the NAR says about one-third of these sales were foreclosure resales or short sales. Although these are real transactions, this means activity (ex-distressed sales) is much lower.”
The key takeaway is not whether or not the housing market has “bottomed,” but that markets are still being enormously impacted by government backed foreclosure moratoria, first time buyer tax credits and efforts to keep interest rates low. With unemployment stubbornly high, the true outlook for a housing recovery remains uncertain.
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Tags: existing home sales, home prices, Housing, NAR, real estate