The “R” logo … a badge of shame?

So I peruse Inman News this morning.  For the uninitiated, Inman News is one of the trade publications covering the real estate industry.  One of their top writers, Matt Carter shared that the NAR has been “cooking the books” to create the illusion that the market is better than it really is.  The NAR (the National Association of Realtors) has always offered information with a overly positive spin.  Real Estate agents have had to overcome questionable advertising done the by the NAR for years.  A case in point, as homes across the country were falling into foreclosure and the facts were revealed regarding bundling and re-selling mortgages, the NAR decided it was a good time to promote home ownership was a good investment. Mr.Carter’s story is just another black eye.

It is important to share, membership in the NAR is not required for an agent to practice real estate. Of course, if you are not a member of the NAR and your local state association, your access to the Multiple Listing Service is restricted and you can not function as a real estate agent.  It is like saying you don’t need a driver’s license to be a cab driver but you can not operate a motor vehicle on public thoroughfares without a driver’s license.

Now we find out that those of us working as real estate agents that have been convinced something about the data provided by the NAR does not jibe with out local markets have been correct.  The market is as bad as we have imagined.  The data provided by the NAR has been a lie.  They are now scrambling to restate (?) the data.

In the interim, that famous “R” logo is losing it’s luster and fast becoming a badge of shame.  Mr. Carter’s article states:

Statistics published by the National Association of Realtors appear to overstate sales of existing home by 15 to 20 percent, mortgage and property data aggregator CoreLogic says in a new report that concludes home sales fell more sharply last year than previously thought.

A NAR spokesman said the Corelogic claim “is premature at best,” and NAR will be making some benchmark revisions to its historic sales data later this year.

NAR’s figures — based on data collected from multiple listing services and large brokerages — show sales of existing homes fell 5 percent in 2010, to 4.9 million. But CoreLogic, which collects public sales records from county recorders and courts, estimates that home sales actually fell 12 percent, to 3.6 million.

The implications are not trivial: a slower rate of sales means that it will take longer to burn through unsold inventory, and a glut of homes for sale in a given market can undermine prices. CoreLogic says the unsold inventory on the market in November represented 16 months of supply, compared to NAR’s estimate of 9.5 months.

Weak sales following the expiration of the federal homebuyer tax credits, an excess supply of unsold homes, and the impact of sales of distressed homes is driving home prices down, CoreLogic said. A national, repeat-sales home price index compiled by the company was down 5.1 percent in November from a year ago.

If that trend continues, national home prices will probably be down 10 percent year-over-year by spring, CoreLogic said.

In its latest forecast, NAR projects that the median existing home price will be down 0.6 percent from a year ago during the first quarter of 2011, but post year-over year gains for the next five consecutive quarters.

CoreLogic says one reason NAR’s existing home sales data may be inflated is because the benchmark multiplier NAR analysts use to adjust for MLSs which they aren’t getting data from hasn’t been calibrated since 2004.

But there’s been consolidation among MLSs since then, CoreLogic noted, and a decline in the number of for-sale-by-owner sales outside the MLS and brokerage process. That means NAR is now capturing a greater percentage of existing home sales and doesn’t need to make so large an adjustment when extrapolating its results.

CoreLogic said that historically it’s only been able to account for 85 to 90 percent of the existing home sales tallied by NAR.

Beginning in 2006, NAR’s sales numbers began to look even more inflated relative to data collected by CoreLogic, the Mortgage Bankers Association, and the U.S. Census Bureau, a trend that has “continued and become more pronounced through 2010,” CoreLogic said in the February edition of its monthly report, “U.S. Housing and Mortgage Trends.”

While NAR numbers show home sales bottomed in 2008 and then rebounded in 2009, CoreLogic data shows no such rebound in 2009.

CoreLogic Senior Economist Sam Khater said the analysis “is less about NAR’s data than a critique of data in general.”

“Anytime you’ve got fundamental changes in the market like that, it’s going to cause market data to go haywire,” Khater said. It’s important to have data from a wide range of sources, Khater said, in order to “see where the truth lies in between them.”

NAR spokesman Walt Molony said that while NAR will be making benchmark revisions later this year to its historic sales data,  “data drift” issues are expected to be “relatively minor.”

“Under the circumstances, the Corelogic claim is premature at best, especially given the process that is currently under way,” Molony said in an e-mail.

The last benchmark revisions of the existing-home sales series was based on 2000 Census data, Molony said, and NAR will soon be rebenchmarking using independent sources. NAR will be consulting with outside housing economists on the methodology to determine if there is any drift in the data, and by how much, he said.

“There’s been a notable increase in nontraditional sales outside MLSs, so a major function in consulting with outside housing economists and government agencies is to determine methodology and obtain consensus on the benchmarking,” Molony said.

He said NAR will also be looking for a new way to rebenchmark existing home sales on a more frequent basis instead of waiting for  Census data to be updated every 10 years. NAR already updates sales rates and months’ supply benchmarks on an annual basis, Molony said.

Molony said the rebenchmarking of existing home sales will result in “no notable changes” to NAR’s previous characterizations of monthly sales changes, and no impact on price data.

Khater said CoreLogic’s public records data captures all sales, whether they involve a mortgage or are all-cash purchases, and regardless of whether a home was listed in an MLS or not.

One drawback with public records data is the lag time before sales are reported and data are collected. Khater said CoreLogic estimated December 2010 existing-home sales in the February report using preliminary data.

There you have it.  Core Logic uses actual data and the NAR uses data from the systems they control…the MLS. If you are interested, have a conversation with any agent about the accuracy of the MLS. All of the data in the MLS is entered by the agents and there is no methodology in place to match it with any facts.

It just could be what was perceived as pessimism on the part of some agents was actually a taste of reality. The market is a long way from recovery.  We know. We work here everyday. We don’t need statistics. We see the results of diminishing returns on our personal income.

So, NAR, forgive me if I don’t endorse you. I pay my dues. I really don’t have a choice in the matter. I only ask that you do not use any of my dues to support your continued skewering the truth.


It’s a Damn Lie !

One of the earliest hi-tech phrases was “garbage in – garbage out”. I keep reading statistics. I keep reading blogs. I hear agents sharing the same stories. The market across the country is labled over-laden with inventory. Signs are in yards block after block. It is a buyer’s market. Really…read on.

Visitors to websites find page after page after page of listings. One begins to think that there are more houses for sale than could possibly be purchased. Agents do searches for clients and come up with literally hundreds of possible listings to view. Touring new homes on the market becomes a two day adventure every week and at the end of those two days, there remains many homes that are never seen.

Everyone says………..we have surplus inventory. The NAR and various local associations all offer what they purport to be empirical data that would indicate it is a buyers market.

It’s a DAMN lie !

The data is not accurate. The data includes homes that appear to be “for sale”, but that sale will not happen. The analysis is skewered by mis-labled homes. Every MLS is at the mercy of agents that enter the data. Agents all across the country do the listing appointments and take the listings. Taking a listing does not mean anything other than the owner of the property would like to sell.

Just taking the listing does not mean it is available for sale at the listing price.

If one goes through their MLS and removes all the 3rd party approval needed listings and removes all the short sale homes, the rest of the listings represent what is accurately available. There is no local or national standard for any MLS that requires the home to be actually available at the price listed.

If the owner has not filed the proper paper work to have a short sale approved, the home is not really available and the listing merely represents the misguided efforts of the home owner and the agent chosen to list the property. It may be available in the future. It is not a real for sale sign in the yard. It is a sign that the owner is in trouble and has sought the counsel of agent that does not understand how to handle a short sale.

Now, there are the homes that are on the market in which the agent has done everything and the owner has submitted paper work and the lender has agreed to go along with the effort. Sure they are in the mix. Of course, if an offer has been submitted to the lender for approval, they still appear as active in the MLS. There is no way of knowing that you are spending your day showing homes that may be under contract tomorrow. No one is mentioning that the bank has an offer and there is no category in the MLS for this home as well. After all, the bank wants to get the best offer and the bank has no concern for the groups of home buyers that are looking for a new home that they can actually own.

Remove all the listings that are “for sale” but not actually available and you will discover that the cupboard may be bare and the market is not quite as over loaded with inventory. It may appear that way, but it is not as it appears. Surplus inventory…we don’t know. Buyer’s market….we don’t know. The MLS is accurate?

It’s a DAMN lie !

Excuse me NAR…that is a cart you put in front of the horse….


I have once again had the opportunity to peruse the latest initiative from the NAR. It is a program dreamed up in a think tank far removed from reality and conceived by a group of people totally out of touch with the world around them. By the way, we pay for this sort of nonsense.

“Home Values” demonstrates the long-term value of housing as an investment, and encourages buyers who are on the fence about making a home purchase to contact a REALTOR® who can help them make a smart investment in their future.” from the NAR website.

Memo to anybody at the NAR that can read and comprehend common sense.






I will try to keep this simple for you. There is natural progression Americans make as they mature. They are educated, attending the finest universities. They socialize. They bond. They marry. During this process they learn the pain of accumulating enormous debt. College loans can take years to repay. They discover the magic of credit cards and they also discover the angst of repaying for nights on the town and constantly updating your wardrobe. They enter the workforce and are shocked to learn that they do not know everything and they can be replaced at the whim of management. They realize that they may be faced with entering a profession that has no resemblance to the job of their dreams. We share with the the sweet phrase..”Welcome to the real world.”


They capture the heart of another and often become man and wife. Most of these unions produce a bit more than one child. The census bureau pegs the average family at 3.1 persons. My guess is that either half the married people are always 3 months pregnant during a census or most folks have one child but every third family has two. It is a math thing.


Once they have been saddled with the debt and they find a suitable spouse and they produce one offspring, then they have to discover the art of budgeting income against expenses.


These are the people that you are suggesting need to view their home purchase as an investment. These are the people that you have determined will listen to that rediculous message.

Stop it!!!!!

Any parent worth their salt will tell you that a home is not an investment opportunity. A home is where you share your life with your spouse and children. A home is your personal place in demanding world. A home is a home.

Now, I believe that the majority of people that accumulate wealth own a home. I am sure that a great deal of the investment wealth Americans enjoy is real estate based. The value of anything is intrinsically tied to supply and it is evident that there is only so much dirt, brick and block. That being said…buying a home is not investing. Buying a home is buying a HOME. (I am trying so hard to keep this simple)

Owning a home does create a sound environment for preparing to invest. Home ownership requires paying a mortgage. Paying a mortgage usually requires budgeting your money. Budgeting your money creates the opportunity for saving money. Money saved is available for investment. The home comes first…investment comes later.

Stop pushing home ownership is a great investment. There are literally thousands of empty condos created with that thought in mind. There are close to a million foreclosures and many of them are the result of “this is a great investment” mentality. Before the dollar falls much farther, you might be better suited to promote the value of a home and the value of a dollar. A market that was built on the fragile dream that buying was a good investment has left millions of Americans broke and renting.

I think it is time you promoted Realtors and let them share the benefits of home ownership with their clients. Realtors actually live in these neighborhoods. Realtors drive these streets. Realtors have bills to pay. Realtors feel the same pinch at the gas pump. Realtors understand the value of a home. Realtors know the true meaning of “Home Sweet Home”.

It’s already 2008…Don’t be late……



crystal ball


Everyone has their best guess estimate of what 2008 will bring. Rather than be left with hollow “I told you so’s”, I have put together what may or may not happen in the coming 12 months.

  1. January – A new year brings more bad news from the financial sector. Losses are mounting and there is no agency on a white horse riding in to save them. A liquidity problem becomes much larger. The result is felt throughout the economy. In an effort to generate the economy, the fed again cuts the rate another half point. Christmas sales fall short of expectations and net sales are far from targets. Layoffs loom. The delayed impact of the increased cost for a barrel of oil finally hits home and consumer costs begin to rise again.
  2. February – Faced with inflationary problems and a stagnant economy, George Bush announces the formation of a new advisory panel to be headed by Mike Brown. FEMA completes the 100% evacuation of all the displaced New Orleans residents from trailors and auctions the empty trailers off on E Bay at about 10% of the value. Unrest in Pakistan continues and Bush calls on the United Nations to step in and supervise elections. His request is ignored. The fed holds the rate with indications that rates may have to go up to stem inflation. My personal world is rocked by a mysterious person. My life will never be the same. Well, pizza is still on the menu.
  3. MarchLate winter storms paralyze much of the country. Bush proclaims storms are a message from God that Global Warming is only occuring in select pockets around the world. NAR proclaims it is the beginning of the Spring market. They introduce a new campaign encouraging buyers with the thought that the purchase of a new home is a smarter investment than using tax dollars to fight the war in Iraq. Scientists in India announce a new neurotransmitter device that allows people to blog and read blogs by thinking. Lenn Harley overwhelms new users and is simultaneously elected Govenor of Maryland, Virginia and Florida.
  4. April – Tiger Woods wins the Masters. Phil Michelson replaces Snoopy as the mascot for the Goodyear blimp. The Feds reacting to massive layoffs in the retail sector raise the rate one point. All 12,000,000 illegal immigrants return to their native country. The American economy is devasted. New home construction comes to a standstill. Roadsides are littered with empty taxicabs. Restaurants are overwhelmed with dirty dishes. Hotel beds everywhere are unmade. Trash is piled at curbs. Bush announces a plan to have Mexico become the 51st state. Mexicans announce they will not join the union but they will take Texas, a portion of Southern California and a bit of New Mexico back and allow the citizens of those areas to remain on guest worker visa’s.
  5. May – The NAR points to the sale of two homes in NW Washington DC at asking price as evidence that the housing slump is over. Lawrence Yun is hired away from the NAR by the Bush Administration and becomes the new Press Secretary. Yun immediately announces that the war in Iraq never occured and that the police action that has been ongoing is a success. The NAR retaliates by hiring Bagdad Bob to replace Yun.
  6. June – The fed raises interest rates again. Gas prices rise to $4 per gallon. Congress demands that the auto industry develop fuel efficient vehicles. Prices for perishable goods increase while farmers petition the government for assistance in getting products to market in a cost effective manner. Heat waves across the country cause rolling brownouts.
  7. July – The nation is rocked by pockets of a mysterious life threatening illnesse that is resistant to known antibiotics. The center for disease control releases guidelines for reporting occurences and how the public can best deal with the pandemic. The Bush administration rolls out stock video of the duct tape and plastic wrap defense originally recommended for dealing with terrorist attacks. The fed raises interest rates again as the stock market continues a downward spiral. China announces price increases on all imports and Walmart becomes another upper class store.
  8. August – The surgeon general releases a report that indicates that the wearing of socks and underwear is not necessary. China announces that it will pad the great wall with the surplus of socks and underwear that is no longer being sent to Walmart. The NAR announces that the summer selling season is in full swing. Lenders announce a new mortage product called the Magic Century. The loan is amortized over 100 years with a balloon payment at the end of 25 years. No doc loans are reintroduced with the provision that 25% cash equity is required.
  9. September – Macintosh purchases several hospital systems. Mac announces a new phone which is an implant. It is cross marketed in their new hospitals. Carbohydrates are declared unsafe for consumption. School systems across the country announce that in the future students will be carted into one room and the teachers will rotate. Home schooling becomes more popular as parents realize that their children are too fat to take to school.
  10. OctoberMajor league baseball announces that steroid useage will be required beginning in the 2009 season. All other major sports leagues release statements that they will follow suit. The NAR announces that the summer selling season was a success citing figures that indicate some homes sold. Bush declares that the constitution has no validity regarding presidential terms and announces that there will be no elections. This is described as an energy saving move. His press secretary goes on to explain that there have been reports of terrorist plots to interrupt our election process so the president has signed an executive order declaring himself president until such time as he determines that the threat has passed. Dennis Kucinich is rushed to the hospital after holding his breath in protest.
  11. NovemberInterest rates for mortgages rise to 8%. Lenders announce the new Century Plus plan. Your home loan is amortized over 125 years with a balloon at the end of 30 years. A loop hole in reverse mortagages allows lenders the right to foreclose and thousands of baby boomers face homelessness. A late season hurricane pinwheels it’s way up the east coast before hitting Manhattan with 150mph winds. Pat Robertson declares it is a message from God that New York is laden with evil non-christians. The Bush administration reveals that it has secret information that the Pope is funding terrorist activity throughout the world. Priests are blamed for causing emotional damage to young boys. Monsiegnors in parishes across the country are blamed for always winning the new car at the holiday white elephant sales. Bush announces that we will invade Rome. Pundits allow that Bush will seek a victory where he can find one.
  12. December – Christmas is in peril. Walmart remains the only retail outlet. All other vendors have moved to an online presence. Shipping cost are not easy to figure out. New rules allow that shipping will be $1 per ounce in addition to an amount equal to the amount purchased and 10 cents per mile from the shipper to your door. The year comes to an end with interest rates at 8%, gas prices at $4.25 per gallon, brownouts on a sequential time table throughout the country. The NAR announces the worst is behind us and that 2009 will be a better year as the market bounces back.

And then again, maybe this is just the result of the ajida one suffers after a good bowl of Jambalya.