Tuesday, February 3, 2009

Dont believe the housing industry economists

Thanks to plummeting prices, pending home sales jumped 6.3% in December, the National Association of Realtors reports.
The NAR’s median home price plummeted 15% in December, year over year, to $175,400… the steepest drop on record.
Almost hilariously, the NAR projects the 2009 median home price to be $198,100. That’s a 12% hike from today’s median. And in 2010, your home’s value will pop another 5%, to an average of $207,700. Seriously? Some people never learn:
“The broad trend over the coming year,” forecast Lawence Yun, the NAR chief economist, back in December 2007, “will be a gradual rise in existing home sales, but because sales are exceptionally low in the final months of 2007, total sales for 2008 will be only modestly higher than 2007.” He predicted the median home price would rise to $218,300 last year… just a tiny bit off. Yun still leads the NAR economics unit.

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