Home Prices will be flat next year, as will home sales - whew! Thank god, I was worried after a 7 year bubble it might take more than 9 months to wash out all the ills... but according to the always accurate Lawrence Yun of the National Association of Realtors - nothing to fear people.
Now Mr Yun is of course unbiased and one of my favorites, since he has been calling for a bottom and quick recovery for about as long as Mr Hovnanian. I see either the NAR has no such thing as performance reviews and/or prefers incorrect information as long as its bullish. I really start to wonder if our major industries, much like the government, overlook bad information as long as its information they want to hear. I mean it works for the government - and "yes men" are famous for trailing along with their favorite CEOs.... truly his track record is sad.
I always love how the media trot out his 'updated' predictions every 4-6 weeks and cheer. Never pointing to his previous track record (abysmal). Plus really this is probably the most biased economist in the entire country you could ask about housing, no?
I spoke about Mr Yun's track record in early October [Realtors Group Lowers Forecast But Lawrence Yun Still on Kool Aid] I will save you the time from clicking on the link - here is his history regarding 2007 sales as of early October. In reverse chronological order.
What did Yun think about 2008 - 6 weeks ago?
(October prediction) Yun now calls for home sales to be down 10.8% from last year.
(September prediction) 30 days ago, Yun thought it was (drumroll) going to be 8.6%, so he is only off by a factor of 25.6% in 30 days.
Here is the kicker... he thought back in February the year over year drop off would be only (drumroll) 0.6%! Don't even make me try to calculate by what magnitude that 'economic forecast' was off by.
You guessed it
Sales will increase (he now says flat?) and a few months before that he was calling for an even larger increase!Yun now predicts 6.12 million in sales, UP from the 5.78 milion predicted for 2007 (which goes down monthly) - thats a 5.9% increase! woo hoo!
(September prediction) Now the kicker of all kickers is that 6.12 million in sales is down 2.4% from his forecast last month, so this is his conservative number. He was even more bullish last month - what were we looking for last month? 8% increase in home sales for 08??
So let's review, completely wrong on 2007 and in the span of under 3 months he has taken down 2008 from a 8% increase (September) to 5.9% increase (October) to flat (November)
Mr Yun, this Buds for You....