I think there has always been a real disconnect between housing statistics being presented nationally and their perception of accuracy to local markets.
On one hand, you’ve got the consumers who read, watch or listen to this information being provided everyday. They live their life and those facts are absorbed for later use.
And then there are the people that are currently trying to sell or buy a property and their personal experience does not connect with the national numbers they are reading about.
In Les Christie’s Housing market pain not revealed by stats [CNN/Money] the piece explores real world feedback and how local housing situations have no real relationship with national statistics and its confusing and upsetting many as the market deteriotates in some parts of the country.
We have had a few years of handwringing about a bubble or market correction.
One one end of the spectrum, there are real estate trade groups like NAR are trying to downplay the negative implications of the latest information for their constituents (hey, thats a trade group’s job), yet it will ultimately provide the trade group with a disservice by weakening their credibility.
At the other end, there are pundits in the blogosphere who trying to call the crash and its drives traffic to their sites for Adsense dollars (hey, thats their passion and belief plus their right to make a living), yet eventually the message is said so often that it becomes white noise.
The consumer is stuck in the middle trying to figure out which way is most accurate for their situation or market, when it is often neither.
The blogoshere has made its impact by rooting out problems with the way national stats by the government, real estate trade groups and others are calculated or interpreted. Thats good. It has opened our eyes to stats like the wild deviations in new housing starts from the Commerce Department, CPI calculations, OFHEO’s use of refinance data in their median sales price and many others.
NAR, NAHB and other trade groups provide useful information for us to digest plus there is something reassuring about knowing the the whole country’s housing market is not going down the drain like a particular market may be. Thats good.
We have more information than ever to filter and absorb. The real problem is the lack of understanding as to what statistics and other information relate best to their particular market. So remember these rules in the spirit of rinse, lather, repeat.
- Rule 1: National housing statistics DO NOT apply to your local housing market.
- Rule 2: Restate Rule 1 to all those who are scratching their heads wondering why national statistics do not apply to their property.