Today’s NYTimes has an interesting article on home sale statistics. What I find the most interesting is how the most pertinent information is in the last two paragraphs. Doesn’t it just always seem this way? They get you with the more inflammatory statements up-front and squeeze the moderation at the end! Check out this data.
“Unlike some other sources of data, the Realtors group does not adjust home prices to reflect changes in the kinds of homes being sold. So if this year’s sales include a larger number of cheaper homes, compared with a year ago, it will appear that home prices are falling even if the actual price of any given home has not declined. Some indexes, including one compiled by the Office of Federal Housing Enterprise Oversight, the federal agency that oversees Fannie Mae and Freddie Mac, do take into account the kinds of homes sold. The government index shows that prices were still rising through the third quarter of 2006, albeit at a far slower pace than in 2005.”
Read the entire article here. To me, this is a great example of how the same data can be used to make opposite points. Are home pricing falling or not? Certainly, there is journalism to back up both answers. If you want to prove your point that home prices are falling, it’s easy! If you want to prove your point that home prices are not falling, well, heck, that’s easy too! And of course, non of it is really that relevant anyway b/c real estate markets are localized, very localized. National or even state-wide data is just not that helpful in determining how much your home will sell for or how much you have to pay for the home you want.