Home sales data misreported due to NAR problem

Calculated Risk: Real House Prices fall to 2000 Levels, Update on NAR Overstating Sales.

The National Association of Realtors issues monthly estimates of the number of homes sold in the U.S. Due to a problem in their methodology, their estimates of home sales may have been 10% to 15% too high from about 2007 onwards.

This would mean that the real estate market is a bit worse than thought with the “months-of-supply” now being much longer than previously disclosed.

In non-inflation adjusted terms, home prices, on average, are now back to early 2003 levels. When adjusted for inflation, home prices have fallen to year 2000 levels (as I read the article). Estimates of further price declines range from 5% to 25% drops – but no one has done well at making predictions.

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