The following information will not receive wide coverage in the media. How do I know? Yesterday’s 337 rise in the Dow was predicated on the number of new housing starts. The background for the “good news” was not covered (well actually it was covered up), in order for the sheeple to have a Wall Street Christmas rally. If the news below would be covered in the media, the market would be down at least 337. A house of cards is still a house of cards and the winds of “change” are about to be unleashed on the financial markets. Which black swan is in your pocket?
David DeGerolamo
US Housing Market Was Artificially Inflated By 14% In 2007-2010 NAR Reports
Just the headlines for now:
- EXISTING U.S. HOME SALES REVISED DOWN BY 14% FROM 2007-2010
- EXISTING HOME SALES REVISED DOWN BY 15% IN 2010 TO 4.19 MLN
Thank you NAR for proving what everyone knew: that the US housing market is one big lie. And next: here come the historical GDP revisions.
The three charts that matter:
And the reasons for the “rebenchmarking”
- Fewer FSBO home sales and more REALTOR®-assisted home sales (e.g., no net increase in home sales in a case where 80 MLS sales and 20 FSBOs shifts to 90 MLS sales and 10 FSBOs)
- More Homebuilders seek REALTOR®-assistance in listing properties on MLSs (More MLS count even though there is no increase in existing home sales)
- Flipping of a home (re-sell within 12 months)
- Re-benchmarked figure excludes the second sale, while they are counted as twice in MLS count
- Enlarged MLS geographic coverage
- Some of the home sales are not an increase in home sales but are just due to enlarged sampled areas
- Double counting as one single property is listed in two or more MLSs
- Example: a home in Colorado Springs is listed in MLS in Colorado Springs and is also listed in MLS in Denver.
Odd: no mention of the primary reason for the “rebenchmarking”, namely that the NAR is nothing but an advertising front for the US housing industry.
