Wednesday, January 28, 2009

Updated 2009 CAR forecast.

January 2009 Forecast:

December 2008 Forecast:

October 2008 Forecast:

Back in November 2008, shortly after the California Association of REALTORS® (CAR) gave its forecast for sale for 2009
I asked if it was already obsolete. Merely looking at the monthly home sales reports the CAR gave clearly indicated that the forecast wasn't matching, and in the case for median price, was in fact exceeding the recent past data. This wasn't data modeling or doing anything fancy just a simple comparison of A vs B and seeing something didn't add up. It is clear that when faced with a large crowd of their peers the CAR simply couldn't break the news that 2009 is just going to be another bad year for prices. If you look at the above graphics, the October and December forecasts are nearly identical (minor change in interest rates) but all of the sudden the January 2009 forecast reduces the median price by $58,000 (a 16.2% reduction from original forecast) and increase in sales for the year by 35,000 (7.8% increase from original forecast). If they just made this forecast as their original forecast at a time when the most eyes and ears were on them they might have actually prepared their members for the year ahead. But instead they release it later after it was clear the original forecast bore no semblance to the reality of 4 months ago much less the future.


Mike said...

When are are CAR and NAR going to finally become obsolete? These people are complete clowns. I cant wait until the general public comes to the realization that these scam artists should be trusted as much as used car salesmen. With the easy access to info these days, their utility is truly coming to an end. I dont need one of them to walk around a house with me pointing out granite counter tops. I know what the f'n look like.

Effective Demand said...

The issue is they are a monopoly. They recognize the threats to their power and have a huge voting base. The only people who could threaten their hold on the market would be if banks got into the business. That is why you see such a massive reaction from the NAR anytime a bank broaches the subject. Since the banks (allegedly) can't be in commerce and banking the NAR has a foothold to squash any attempt to get in the market.

It's a tough nut to crack, but people are continually trying.

Anonymous said...

The NAR and CAR are a bunch of lying crooks. I wouldn't be surprised that if anyone did some digging into these entities and the individuals who work there, we'd find all sorts of illegal activities going on.

All we need is one person to start it all.