CA Association Of Realtors Needs A Math Class, Or Perhaps Ethics As Well

In their latest attempt to paint a picture of the glass totally full of Cristal Champagne, CAR released a August home sales report on Thursday that made it seem as though the state had no housing-related issues whatsoever.  This is exactly why I always scream ‘YOU CAN’T BELIEVE THE HEADLINES!

“Sales are now 85 percent above the monthly trough for this cycle, which occurred in October 2007, and for the first time this year are ahead of 2007 in year-to-date terms,” said C.A.R. President William E. Brown”.

I think CAR either needs a math class or should not be allowed to ever put out another press release. I have no idea what they are even saying here…

The statewide sales figure represents what the total number of homes sold during 2008 would be if sales maintained the August pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales

Closed escrow sales of existing, single-family detached homes in California totaled 490,850 in August at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity increased 56.7 percent from the revised 313,310 sales pace recorded in August 2007. Sales in August 2008 increased 1.8 percent compared with the previous month.

This would not bother me so much if three days before I didn’t put out a very well-researched August CA Home Sales Report saying:

August was not good for the CA real estate market. Just one month after pom-pom’s were flying over how well the market did in July and bottoms were again being called across the board yet again, August, a peak sales month, delivered another blow. Total sales were off, organic sales were off, foreclosure-related sales rose, defaults rose and prices tumbled.

The facts are that in August 2008 37,988 new and resale properties sold according to DataQuick. Last August, there were 33,429. There was an increase but nowhere near 85% above or the 56.7% quoted below. The sad part is in August 2005, 73,285 home sold. Yes, there was an increase year over year from August 2007 to 2008, which could be viewed as encouraging. However, the number of ‘organic’ sales in August 2008 were only 21,172, as foreclosure-related sales made up 46.9% of the total sales. In August 2007, foreclosure-related sales were negligible. Therefore, in my book real home sales fell sharply from August 2007 to August 2008 and the foreclosure market remains the real estate market at least for now. Nice try guys.

CAR Press Release Highlights

Link: For release: Thursday, Sept. 25, 2008

C.A.R. reports sales increased 56.7 percent; median home price fell 40.5 percent in August

LOS ANGELES (Sept. 25) – Home sales increased 56.7 percent in  August in California compared with the same period a year ago, while the median price of an existing home fell 40.5 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today

“Sales are now 85 percent above the monthly trough for this cycle, which occurred in October 2007, and for the first time this year are ahead of 2007 in year-to-date terms,” said C.A.R. President William E. Brown.

“While this is encouraging news, we don’t expect to see a housing market recovery until prices stabilize and the number of distressed properties on the market declines,” Brown said. “Sales gains continue to be driven by the large share of deeply-discounted distressed sales in many parts of the state”

Closed escrow sales of existing, single-family detached homes in California totaled 490,850 in August at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity increased 56.7 percent from the revised 313,310 sales pace recorded in August 2007. Sales in August 2008 increased 1.8 percent compared with the previous month.

The statewide sales figure represents what the total number of homes sold during 2008 would be if sales maintained the August pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The median price of an existing, single-family detached home in California during August 2008 was $350,140, a 40.5 percent decrease from the revised $588,670 median for August 2007, C.A.R. reported. The August 2008 median price fell 0.2 percent compared with July’s revised $350,890 median price.

“While sales appear to have turned the corner, the median will experience additional downward pressure as we move into the off-peak season in the coming months, and will continue to face pressure from distressed sales,” she said. “Sales are just one of the variables that must fall into place before we see real improvement in the market.”

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