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The hallucinogenic spin-meisters over at the National Association of Realtors are, once again, misstating what their own data indicates:

Flat Existing-Home Sales Likely Before Gradual Recovery
The volume of existing-home sales is expected to hold steady through late spring, with a gradual recovery during the second half of the year as the mortgage situation improves in high-cost areas, according to the latest forecast by the National Association of Realtors. Lawrence Yun, NAR chief economist, said many buyers have been waiting for higher mortgage loan limits. “The higher loan limits for both FHA and conventional loans will increase consumer choice and provide greater access to lower interest rate mortgages in high-cost regions,” he said. “Therefore, a notable rise in home sales can be anticipated in the second half of the year."

This statement reflects a combination of wishful thinking and factual misstatements. Let's review the specifics.

First, the Pending Home Sales Index fell 19.6% from year ago levels. This is hardly a "flat" number, as described by their PR release. This is significant, as the NAR itself notes in the footnotes to their The Pending Home Sales Index:

"There is a closer relationship between annual index changes (from the same month a year earlier) and year-ago changes in sales performance than with month-to-month comparisons."

Hence, the data that matters most is not the change from December to January, filled as it is with seasonal anomalies, but rather, the January 2007 to January 2008 comparison. That showed almost a fifth lower than the prior year's index.

When we consider the rest of the data that's out there, its apparent that stabilization is not the correct word:

-U.S. foreclosures hitting another record high
-Inventory at or near all time highs
-Interest rates rising

Well, at least they stopped saying "Bottom" -- after two years of getting that word wrong.

Source:
Flat Existing-Home Sales Likely Before Gradual Recovery
NAR, March 06, 2008

Source: Pending Home Sales Down 19.6%