Yesterday, the National Association of Realtors (NAR) released their Existing Home Sales Report for November again confirming, perfectly clearly, that demand for residential real estate, both single family and condos, has taken a new and substantial leg down uniformly across the nation’s housing markets likely as a direct result of the momentous and ongoing structural changes that are taking place in the credit-mortgage markets.In his latest installment of preposterous spin, NAR senior economist Lawrence Yun attempts to fool hapless homebuyers into believing that slowing sales and declining prices indicates market “stabilization”.
“Near term, existing-home sales should continue to hover in a narrow range, just as they have since September, and that’s good news because it’ll be a further sign that the housing market is stabilizing, … Mortgage interest rates are near historic lows and the most current data shows decelerating price declines, along with a modest reduction in the number of homes on the market.”
Just to put things into perspective a bit, let’s look at the NAR’s outlook from last December when then chief economist David Lereah presented a similarly unrealistic and likely purposefully negligent view.
"As the housing market recovers from its correction, existing-home sales should be rising gradually during 2007 -- it looks like we may have reached the low point for the current cycle in September, … We've entered a more sustainable period of home sales now, and we expect greater support for prices over time as inventory levels are eventually drawn down."
Additionally, NAR President Richard Gaylord makes a plea for a government bailout of the residential real estate industry by suggesting that the conforming loan limit, a limit used by the federal government to define the lending threshold between affordable housing loans and more lofty jumbo loans, be raised even in the face of declining home values.
“Consumers have some choices with safer conventional financing, but raising the limit on conforming loans would significantly revive home sales, … This would help creditworthy buyers in hard hit regions like California and Florida by greatly increasing access to low-interest-rate mortgages. NAR, as the leading advocate for homeownership, strongly urges lawmakers to act quickly on this important measure.”
The latest report provides, yet again, truly stark and total confirmation that the nation’s housing markets have now taken a new leg down with EVERY region showing significant double digit declines to sales of BOTH single family and condos as well as large increases to inventory and a continued explosion in monthly supply as a result of the collapsing pace of sales.
Keep in mind that these declines are coming “on the back” of last year’s dramatic declines further indicating that the housing markets are truly in the process of a tremendous correction.
Particularly notable were the following:
- Sales are down significantly in EVERY region and for BOTH single family and condo.
- Prices for single family homes declined for EVERY region.
- Prices for condos declined in every region but a anemic gain in the South.
- ALL Inventory and Months Supply show significant increases on a year-over-year basis.
Below is a chart consolidating all the year-over-year changes reported by NAR in their November 2007 report.
