Funny NAR Numbers Just Don’t Add Up!

The NAR has just alerted the planet that they are about to revise their reported home sales data downward for existing homes back thru 2007 in a ‘meaningful’ way. Terrific… just what we all need… bad news on top of already dismal news!

The NAR has cited several reasons for the new set of data including their use of outdated assumptions reported by the 2000 census and the geographic expansion of MLS geographies causing ‘double-counting’. This apparently has compounded the problem of only counting MLS data, which as we know, only includes agent listed homes and not those sold by the owner, or For Sale By Owner.

Mr. Yun has said, ‘and because more people are using realtors to list their homes instead of selling them independently, realtor-listed sales numbers have become artificially inflated’. Wait a minute, this sounds as though the NAR has just discovered this fact! The NAR had been publishing an annual research survey, ‘Profile of Home Buyers and Sellers’ for at least the past decade. Each year they compile the number of homes sold with the help of an agent compared to those sold by owner.

The 2007 report cited 12% of all home sales were FSBO. This percentage of FSBO sales has varied by no more than 1-2 percentage points annually thru 2011, when FSBO’s represented 10% of all existing home sales, which was up 1 percentage point from the previous year. What is confusing in the remarks of the NAR is why they would now all of a sudden suggest they have been overcounting MLS sales figures. They have always been tracking FSBO sales and the annual estimated FSBO sales have not changed significantly over the past 5 years. Therefore, it is confusing as to why now they would make an adjustment to their modeling projection for this factor. This seems to suggest the NAR is trying to characterize FSBO sales as being increasingly insignificant because more and more sales are via an agent. As cited in their own research, this is not the case at all. In fact, their own research data reveals that there are a significant level of ‘Flat-Fee MLS’ sales which are actually owner sales that have opted to only pay a buyer’s agent a commission. The NAR disguises this data by labeling as ‘the agent listed the home in the MLS and performed few if any additional services’.

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