Home sales data revisions made
Dec. 22, 2011, Detroit Free Press (Freep.com)
National home sales data crunched by the National Association of Realtors was inflated by 14.3% going back to 2007, according to revised numbers released Wednesday, but economists said the revision doesn't change a better outlook for housing.
"The revision shows weaker sales from 2007 to present, but the pattern is the same," said Robert A. Dye, chief economist for Dallas-based Comerica Bank. "From my point of view, this does not significantly alter my view on the housing market. The recent trends are intact."
The association said it reduced its earlier counts of home sales as its data became out of whack with market realities.
It also reported that existing home sales were up 4% in November from a year ago, continuing a trend of tentative gains in the beleaguered housing market.
The restated data indicate that there were 4.19 million existing homes sold last year, down 14.6% from the previous projection of 4.9 million. The revisions impacted only the annual sales figures and not the month-to-month.
Lawrence Yun, chief economist for the association, said the data revision does not affect local home prices or local multiple listing service data.
The disparity developed over time between the sales reported to NAR by the local listing services and sales determined by a U.S. Census benchmark, he explained. Reasons for the shift in the data include population shifts and an overestimation of the number of for-sale-by-owner transactions, which softened during the downturn.
Existing home sales are of marginal value in predicting housing market strength, IHS Global Insight economists Patrick Newport and Michelle Valverde said in a statement.
This is because sales could rise on distressed sales, which is a sign of market weakness, or because the economy is improving, a sign of strength, they wrote. The new construction market is a better gauge of housing market health, they said.
In November, 28% of sales were cash purchases. The sales data included closed transactions and showed existing home sales at a seasonally adjusted annual rate of 4.42 million last month. That's a 4% rise over October and a 12.2% increase over the November 2010 pace.
The national median existing-home price was $164,200 in November, down 3.5% from a year ago. Housing inventory fell 5.8% to 2.58 million homes for sale, or a seven-month supply at the current sales pace.
To view the data, go to: www.realtor.org/research/research/ehsdata.
Contact GRETA GUEST: 313-223-4192 or firstname.lastname@example.org