When Will the Mainstream Media Be Ready To Call The NAR The Sham That It Really Is?

Reggie Middleton's picture

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drwells's picture

The WSJ? That would be the same publication that runs articles like this.


They couldn't see the credit crash and depression coming, but at least they've got plenty of room to give free advertising to politically correct troll pieces.

If a person wiped his ass with the WSJ, he'd become dumber (and possibly contract herpes).

razorthin's picture

Awesome.  Thanks, Reggie.

Weisbrot's picture

1>thank you RM

2>we know the WSJ is part content and part show time

mynhair's picture

NAR, Never Allow Reality

Scout6909's picture

Since October, housing prices have accelerated their decline. A home is Scottsdale that sold for $1.4M in 2006 just appraised for $350k. 

The negative wealth effect is "climbing the ladder".  I talk to a lot of people that used to be well off, now, they are on the verge of bankruptcy.  Shocked by what has happened.






wisefool's picture

Right. Audi is running adverts now comparing "old luxury" (Mansion/Benz) to "new luxury" (Audi / freedom to drive to cool landscapes)


When the boomers got on the housing bandwagon they had genuine incentive because they were upgrading from the houses they grew up in: Small, closed floor plans, old pumbing, old wiring. Small towns or manufacturing neighborhoods.

You can put all the granite countertops you want in a suburban home, but unless it has a flying car in the garage, you are not going to convince the next generation to buy them at 10x income, no matter how well the NAR RE agent dresses.

wisefool's picture

Wall Street wanted in on the real estate agent game too. They had the guy who created the first "Mortgage Backed Bond" on CNBC today in his "first ever interview"

Faber said it was the perfect P-train (profit-train) 'cause you could work on something for 3 months, make a ton of money, and then walk away from it with absolutely no responsibility, on an item which is ostensibly the largest investment a person makes in thier life.

So the MBS inventor dude says "yeah, that was part of the problem. Where we go from here is tough to figure out. Housing typically had an investment aspect to it. But you can't tweak the machine too much. If we endup having to reprice housing as shelter, all bets are off"

Which is already happening. I see it as a generational thing. Boomers treasured thier homes, they were a status symbol and place to raise children. GenX'ers Y'ers, etc don't get thier esteem from housing. They value gadgets, cars, lots of college,  free-time and atypical family formation.

Itsalie's picture

Law of averages tells me there has to be some errors either side of the real picture, but that's not what you seeing, its not hedonics, not rounding, not seasonality folks, what you need here is the chinese data syndrome; just subcontract the work out to the central planners, it would be cheaper, and the exact "data" is leaked out at clockwork precision so the markets and MSM can do a good blow job early.

buzzard beak's picture

Hey good going getting on fast money. Give them pampered-ass white boys hell.

Of course the NAR is totally biased. It's a lobbying organization. You expect the AMA to admit the prevalence of unnecessary surgery?

The fault isn't with the NAR really, it's with the media who take its "statistics" at face value. Do you criticize the Dallas Cowgirls for being biased toward the Cowboys? Why would the NAR put out honest data that harms its members' interests? This admitting two years later that it ridiculously underreported the downturn is just what you should expect from the NAR.

geno-econ's picture

Correction from my previous post: we have had racial supression for over 100yrs as well as a Civil war

geno-econ's picture

The housing bubble is also a behavioral case study on many different levels;

   Number of people at lower income levels that are vulnerable to being swindled. Education and advertising a major factor

   At upper level , peer pressure and cocktail circuit plays major role convincing many to upscale and  refinance for purposes of consumption

   At enteprenurial level to outsmart  system by flipping properties and leveraging  residential and commercial properties to maximixe profits

 At senior age level temptation to use reverse mortgages, home equity loans and annuities{not RE related} to maintain life style

It does seem many at all levels lost all  sense of reality and common sense because we have had it too good for too long. The message from Reggie is it will not turn around soon and learn from your mistakes. Yes our policmakers should share some blame but they left town long ago or hired the best lawyers in town. Of coarse there is always Egypt , Tunesia, Libya but their people were never spoiled, just supressed.  Perhaps supression is next for us before the revolution 

Yes We Can. But Lets Not.'s picture

I am selling my home FSBO, using Craiglist and a dollar store sign.  Total cost, $1.05.  Just this past week a couple came by, fell for the house, then mentioned that they had signed with a broker.  Oops.  The broker lost them the deal due to her crazy fee and due to the fact that she proved to be such a galling, lying, incompetent, unprofessional boob, which near as I can tell is generally what the term Realtor is a euphemism for.

I Got Worms's picture

Are you buying a new house with the proceeds or renting? I sold my home of 7 years just two months ago, am renting, and think it was about the best move I've ever made. Will not be buying for quite some time (unless I find a reasonably priced farm with a bomb shelter).

I will say this though, 99% of my decision to sell my house was made after discovering this site and Reggie's posts. I feel the invisible hand led me to ZH...

Stone Street Advisors's picture

Sounds about right.  Realtors are just zero-value-add rent-seeking parasites, and that's being nice.  I'm sure there's about 1 or 2% of realtors that actually know what they're talking about (I know one off the top of my head), but it seems to be the exception, not the rule.

apberusdisvet's picture

By the time the median home price drops to affordable levels for the declining universe that can actually qualify for a mortgage, the vacant housing stock will be so deteriorated that it will have to be bulldozed.

dark pools of soros's picture

yup -  bulldoze the foreclosed dumps, the banks take a loss (whatever that is, i dont think they print that column on their sheets), and everyone bails them out and gets to own a piece of vanished homes!!



Carl Spackler's picture

I wonder if the author of the books Reggie cited drank his own kool aid and is now broke ?!

Stone Street Advisors's picture

I think Lerah knew he was just a marketing machine, not any sort of real economist (and if not, he's seriously delusional).  I think a better question is what % of people decided to buy or sell their homes based on this nonsense BS NAR data.

Mr Lennon Hendrix's picture

Also no doubt it is dubious not ironic that gold/silver/platinum are collectively breaking out as the housing market collapses.  Inversely it works perfectly.  Massive deflation hits the larger populace of Americans, while inflation leaks into the hands of gold and co.  This destroys the wealth of any compitition to the monied class, keeping the playing field "even".

The combination of massive deflation due to the housing crash with an amount of money printing that is equal to the deflation allows the gain to leak into gold et al.  This is steady inflation.

falak pema's picture

The invisible right hand of the market and the corporate lobbying by media for oligarchic masters, to hide the tilted table behind the curtain concocted by left handed shenanigans.

Mr Lennon Hendrix's picture

Reggie and Tyler,

You guys could write/publish a book with this stuff.  In the works?

topcallingtroll's picture

I am thinking optimistically we still have 15 percent to go.

Pessimistically 35 percent.

Nominal of course/p>

Careless Whisper's picture

looks like mister lereah's books are a really good contra-indicator.

most real estate has been tanking, except in manhattan (south of 86th street) which has held up relatively well. any comments on manhattan real estate?




gmj's picture

That's where the plutocrats are concentrated.  Think of Manhattan as a black hole for America's wealth.

Stone Street Advisors's picture

NEWS FLASH: the majority of people who live in Manhattan are nowhere close to plutocrats you moron.

gmj's picture

"The Manhattan ZIP Code 10021, on the Upper East Side is home to more than 100,000 people and has a per capita income of over $90,000.[123] It is one of the largest concentrations of extreme wealth in the United States."


tony bonn's picture

"...I think we are very near to the end of the housing downturn,” Yun said.." as quoting jim cramer.

cramer went on to declare the bottom of the housing market on june 30, 2010. (it could have been 2009) either way cramer is a turd of a carnival huckster.

whatz that smell's picture

welcome to the "new" free market... dancing turd carnival huckster show at 7.

Eternal Student's picture

To answer the original question of: "When Will the Mainstream Media Be Ready To Call The NAR The Sham That It Really Is?", the answer is very simple.

The MSM will do this once the Real Estate Industry quits buying up so many of their ads. Real Estate advertising is big money to the older Media. Pissing off your best customers isn't a good business model.

There's a big difference between real journalism and the corporate media that we have today.

Fuckin Floyd's picture

Sounds like politics. most of the campaign dollars go to the media. lower limits are sorely needed.

Bicycle Repairman's picture

Gonna party like it's 1989!!

Eireann go Brach's picture

Realtors are quite possibly some of the most ignorant human beings to walk this earth, the majority of them have no sales skills, can't count and know nothing else but to tell you it is the best time to buy a home! Many of them would sell a home to their granny even if it was the worst time to do so.

I am more equal than others's picture

.... but they know when the colors are pretty.  6% commission for that?  They only know the color of money and are still part of the problem.  They have the 'favorites' who magically make deals work that shouldn't. 

Stone Street Advisors's picture

They largely only know what the NAR & their firms' tell them.  Its fun going around with a realtor (or worse, a NYC rental broker) and knowing FAR more about a building/neighborhood/apartment than them. 

And by fun, I mean infuriating.  I do to FSBO route.  No reason in the internet age anyone should want to pay a realtor unless I suppose if you're moving to another state that you do'nt know at all.

PulauHantu29's picture

When I started reading their reports backj in 2007 they were so out of whack with what I was seeing as I drove across the country...I am glad some are finally smoking them out. People need reliable data to make informed decisions...not Bogus Numbers.

Stone Street Advisors's picture

I did a similar article with the core-logic data v. NAR, its ridiculous.

I first pointed the nonsense from NAR in 2009 here: http://1-2knockout.typepad.com/12_knockout/2009/01/question.html

Their math just doesn’t add up. Their quarterly % changes don’t match their annual #’s, I mean, that’s BASIC elementary school math! This is why I think their “data” releases are in PDF format and not Excel, to discourage/make it harder for people to analyze their “data.” In their US Economic Outlook December 2008, they have quarterly GDP % changes as 0.90%, 2.80%, -0.30%, -5.20% respectively, and an annual % change of +1.2%.

If you calculate it though, with those quarterly numbers, the annual change in GDP would be -1.96%. Unless I’m missing something, that is a major misrepresentation of basic mathematical fact.

A Man without Qualities's picture

"If you calculate it though, with those quarterly numbers, the annual change in GDP would be -1.96%. Unless I’m missing something, that is a major misrepresentation of basic mathematical fact."

It may be due to seasonal adjustments, so the weighting for Q4 is far lower.  Of course, it's strange how the adjustments always end up being to the upside....

I am more equal than others's picture

One simple word for the number nonsense is 'hedonics.'

masterinchancery's picture

Even Case-Shiller is seriously biased upward, since they uncritically accept MLS data, which frequently does not incorporate the fact that houses have been torn down and rebuilt at great expense, hence the huge "profit" does not exist. I speak from experience.  Also of course, C-S methodology, looking only at resold homes, cherry picks the universe of housing.

falak pema's picture

If you mix a Case-Schiller bubble with a head and shoulders shampoo and then say 'atchoo' to a Laffer curve what do you get in the futures market : a put or a call? It's driving me nuts that so much hard evidence about the past gives me no inkling about the future. It's like the problem of the guy with a hard-on which he could never synchronise with his girl's need for 'hi-ho silver away'. But then he'd never heard of artificial stimulation and she of artificial simulation. They were such a happy couple in their mutual ignorance, achieving a truly undiluted, uninhibited miracle every once in a while.

solgundy's picture
When Will the Mainstream Media Be Ready To Call The NAR The Sham That It Really Is?


only if obumma says they can...

Hugh G Rection's picture

 It's like the problem of the guy with a hard-on which he could never synchronise with his girl's need for 'hi-ho silver away.


I dont appreciate you spreading rumors about me.