On December 21, NAR will release its recalculated existing-home sales (EHS) data, which will show that sales since 2007 were lower than it originally reported — in some cases, significantly.
The process began almost a year ago — in February — when CoreLogic reported that it found NAR’s numbers were off by as much as 15%. Since then, NAR has been working with economists, statisticians, and other experts (the Federal Reserve, Fannie and Freddie, HUD, the Mortgage Bankers Association, and even CoreLogic) to revise those numbers so they better reflect reality.
The EHS numbers NAR reports have always been estimates based on surveys of sales and mathematical models. They were never meant to be exact figures. But the collapse of the housing market changed the real world enough that NAR’s models didn’t fit well anymore, hence the revisions.
Yes, yes, but what does it all mean?
Here are the important points to remember:
- The revised numbers do not affect local figures. These are national only, and local sales figures are unchanged. If your MLS said 417 homes were sold in March 2009, then 417 homes were sold in March 2009, period.
- The revisions are of the number of sales, not prices.
- While the numbers are going to be revised down, the changes will be the same — so, for example, a 12% year-to-year increase with the old numbers will still be a 12% increase with the new ones.
And there’s one frequently asked question that we should answer: If MLSs data are accurate, why doesn’t NAR simply aggregate all that and get the real sales numbers?
The answer(s): MLSs don’t include every sales; FSBOs, for example, aren’t recorded. There is also overlap, with the same property being listed in more than one MLS. So while MLS data has been and will be accurate for local regions, it’s all but impossible to use it on a national scale.
If you want more information about the whole rebenchmarking thing, NAR’s got you covered.
You can also contact NAR’s media department at 202-383-7515. “They are the best source of information regarding the national existing-home sales report and the rebenchmarking process,” says the organization.