Saturday, August 25, 2007

If ever there was a more meaningless statistic than that home sales were up 2.8 in July from June, I don't know what it is. The statistic that counts is that sales were down 10.8 from 2006. But in usual grasping at straws manner, Norma Dubois find is "very encouraging." Never mind that Bend had it's lowest sales in five years.

But July is pre-crisis, pre-credit tightening. It's probably the last bit of 'good news' they are going to hear for a long, long time.
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4 comments:

Unknown said...

It's just another sign of desperation.

First of all, one month's numbers are far from setting a new trend.

Second, this statistic, like many economic statistics touted these days, is almost completely bogus.

The new home sales numbers reported don't include sales contracts that have been cancelled. With cancellation rates running 50% at many of the largest national builders this statistic is highly unreliable, at best.

The fact that the Bulletin is grabbing onto it to make it such a prominent article is just sad. It has absolutely no bearing on CO real estate and, because of the flaws in the reporting, has little or no meaning nationally...

August 25, 2007 at 10:42:00 AM PDT
Duncan McGeary said...

In 27 years I've never had a July that wasn't higher than June. Month to month statistics are absolutely useless. Same month year to year is all that matters.

If sales actually dropped in July, that would be a 'man bites dog' story.

I also consider any changes under 5% as statistically valueless. I have a small business so a few extra sales can swing the needle. But even nationally, I'd think 2.8 is a small number to base any conclusions on.

So unless the way they gathered the statistics is extremely accurate, that 2.8 probably isn't enough to cover the 'margin of error.'

August 25, 2007 at 11:15:00 AM PDT
IHateToBurstYourBubble said...

What I really loved was the fact that July 2007 medians were DOWN from July 2006 in all Cent OR towns. We are DOWN YoY.

Not a syllable, not a word in The Bulletin anywhere.

But by God, if nationwide sales blip up just barely, all of a sudden DuBois declares Bend ALL CLEAR.

Nice objective reporting.

August 26, 2007 at 9:39:00 AM PDT
Bend Economy Man said...

Ditto to Jesse = the numbers for new home sales are recorded when a CONTRACT IS SIGNED, not when escrow closes. As Jesse mentioned, the cancellation rate is high. You can expect that a 2.8% increase is really a significant decrease once the adjusted numbers come through. And, as Duncan mentioned, 2.8% is probably within the margin of error anyway, statistically speaking, so it's a non-event.

It is sad, very sad, that The Bulletin reports this as a light-at-the-end-of-the-tunnel story, especially because, when the national news is NEGATIVE about housing, the argument that The Bulletin reports is "but we're different." Can't have it both ways...

August 27, 2007 at 1:06:00 PM PDT

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