An Alternative Script for NAR's Chief Economist

In the National Association of Realtors' monthly report on existing home sales, where sales fell 2.0 percent in March (now down 19.9 percent on a year-over-year basis) and home prices continued to tumble (down 7.9 percent from a year ago), NAR chief economist Lawrence Yun had the following comments:

Though mortgage rates are at historically low levels, some borrowers are facing restrictive lending practices in declining markets. At the same time, many buyers continue to bide their time with a large number of homes to choose from, while other potential buyers remain on the sidelines.

If Lawrence had wanted to paint a more accurate picture of current conditions, he might have said something like this:

Look, everyone is scared to death right now - lenders, buyers, realtors - never, ever in a million years did we think that prices would drop like this. I mean, who wants to buy a house that is probably going to lose $20,000, $50,000, or $100,000 over the next year? If you can buy a foreclosed property at a steep discount, have at it. Otherwise, stay away.

Here's the chart:

High inventory + low sales = falling prices.

Comments

[jetsby10:]

Lawrence Yun is a jerk that is hellbent on trying to convince as many people as possible to destroy any type of savings they have.

2008 Apr 23 12:55 PM

[HARM:]

“If you paid your mortgage off, it means you probably did not manage your funds efficiently over the years,” said <b>David Lereah</b>, chief economist of the National Association of Realtors and author of “Are You Missing the Real Estate Boom?” “It’s as if you had 500,000 dollar bills stuffed in your mattress.”

He called it “very unsophisticated.”

Anthony Hsieh, chief executive of LendingTree Loans, an Internet-based mortgage company, used a more disparaging term. “If you own your own home free and clear, people will often refer to you as a fool. All that money sitting there, doing nothing.”

Source: L.A. Times (August 28, 2005)
“Equity Is Altering Spending Habits and View of Debt”

2008 Apr 23 01:57 PM

[HARM:]

lawrenceyunwatch.blogs.../
davidlereahwatch.blogs.../
marinrealestatebubble....

2008 Apr 23 02:02 PM

[Yoski:]

“If you paid your mortgage off, it means you probably did not manage your funds efficiently over the years,”
If you lost you life savings gambling on real estate you probably did not manage your funds efficiently over the years.
Now that's what I call a paradigm shift....bwaaaaaahhh!!...

2008 Apr 25 06:27 AM