When The Market Was Crashing In August, NAR Says Existing Home Sales Soared

Tyler Durden's picture

Confirming that when it comes to providing credible, timely information, the NAR is second to none with its release that while the market was tumbling, the economy was collapsing (recall that abysmal August Philly Fed number), the US was on the verge of bankruptcy, and Europe was getting deliquified... existing home sales soared by 7.7% from 4.57 million to 5.03 million, on expectations of a modest rise to 4.75 million. No typhoons, rogue trades, abnormal heat or cold, earthquakes, High Frequency Trading or any other "transitory" events were 'blamed' for this stunning beat. Well actually Irene was blamed for the number not being even bigger. All is well: supposedly we can now take Operation Twist off the table.

Then again, visualizing the data... Leave a little to be desired (keep in mind the year ago drop was due to the govt tax benefit remission).

From the NAR release:

Existing-home sales increased in August, even with ongoing tight credit and appraisal problems, along with regional disruptions created by Hurricane Irene, according to the National Association of Realtors®. Monthly gains were seen in all regions.

 

Total existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, rose 7.7 percent to a seasonally adjusted annual rate of 5.03 million in August from an upwardly revised 4.67 million in July, and are 18.6 percent higher than the 4.24 million unit level in August 2010.

 

Lawrence Yun, NAR chief economist, said there are some positive market fundamentals. “Some of the improvement in August may result from sales that were delayed in preceding months, but favorable affordability conditions and rising rents are underlying motivations,” he said. “Investors were more active in absorbing foreclosed properties. In additional to bargain hunting, some investors are in the market to hedge against higher inflation.”

 

Investors2 accounted for 22 percent of purchase activity in August, up from 18 percent in July and 21 percent in August 2010. First-time buyers purchased 32 percent of homes in August, unchanged from July; they were 31 percent in August 2010.

 

All-cash sales accounted for 29 percent of transactions in August, unchanged from July; they were 28 percent in August 2010; investors account for the bulk of cash purchases.

 

“We had some disruptions from Hurricane Irene in the closing weekend of August, when many sales normally are finalized, along the Eastern seaboard and in New England,” Yun said. “As a result, the Northeast saw the smallest sales gain in August, and some general impact is expected in September with widespread flooding from Tropical Storm Lee. Aberrations in housing data are possible over the next couple months as markets recover from disrupted closings and storm damage.”

Inventory declined:

Total housing inventory at the end of August fell 3.0 percent to 3.58 million existing homes available for sale, which represents an 8.5-month supply4 at the current sales pace, down from a 9.5-month supply in July.

Of course this as usual excludes the millions and millions of homes in shadow inventory.

As for median home price, well...

The national median existing-home price3 for all housing types was $168,300 in August, which is 5.1 percent below August 2010. Distressed homes – foreclosures and short sales typically sold at deep discounts – accounted for 31 percent of sales in August, compared with 29 percent in July and 34 percent in August 2010.

Hmm, perhaps there is more to this number than the headline reveals.

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razorthin's picture

Seriously, why do they even bother to release ANY data?  No one believes any public number anymore.  Nobody.

GeneMarchbanks's picture

Real estate is now safe... {whew}

TruthInSunshine's picture

According to NAR's incredibly successful predicitions, real estate has bottomed in each of the last 39 months.

NAR, where it always the best time to buy!

Caviar Emptor's picture

Keep in mind this: the rise of the cash-only deal (noted by many) shows that home sales are mainly to speculators and investors, not individuals. Confirmation comes from the MBA mortgage ap data which has shown marked declines in the purchase index despite record low rates

Problem Is's picture

+10... Classic.

Is it possible Yun is a bigger liar than Obama Bin Lyin' himself??

Overflow-admin's picture

Turn inflation into wealth bitchez!

Careless Whisper's picture

Sales* Soared

foreclosures ... accounted for 31 percent of sales in August

*sales = repos


plinythehunger's picture

Right. And are the inventory numbers wild fire adjusted? Realtors need something to keep themselves busy, so why not start a bunch of brush fires? Every $1 in kerosene creates 1,000 jobs.

Tense INDIAN's picture

just what might happen if there is no OT or no OERATION at all....and the fed says something like that they will be keenly looking at the economy

rocker's picture

  A house on Sale for 50% is usually a buy.........Maybe.

monopoly's picture

Lets see what the numbers are 5 years from now. Nothing new.

razorthin's picture

At Dow 6500, it will be a TREMENDOUS buyer's market.

Fools.

spartan117's picture

They also indicated rents were up.  Which is bullshit.  If you have access to MLS, you can clearly see rents are not going up.  At least in my neck of the woods.  Rents are coming down in Southern Cal, as owners are cutting rents after the summer months when traffic is the highest. 

DosZap's picture

spartan,

Depends on where you are..................rates in most large Texas cities are UP.

waylon153's picture

I'll second that.  Here in Houston, Class A/B/C market occupancy for apartments are running 87% and rents are up.  Class D is taking a hit because new projects being built.  Multi-family rates for new constuction running 4% for 10 year, 3.5% for 5 year.  Our economy has fared pretty well.  Other areas, not so much....

Edit:  Also, Low Income Tax Credit Housing is booming.  Can't build them fast enough.

fdisk's picture

Don't talk for all. In my area rents are up 20%+ since 2 years

ago.

spartan117's picture

Looks like I poked the hornets nest of Landlords! 

I was personally able to lower my rent in Arcadia, CA by 10% this past summer for the next year.  And Arcadia houses one of the best school systems in the SGV.  You guys have no pricing power in this market.  Sure there are a few areas of strength, but if you really want people to believe that rents are going up as unemployment worsens and consumer confidence drops, you're going to have to provide much more than just anecdotal evidence that "rents are up where I live" BS.  You can check Zillow to see that asking prices for rents are well below "zestimates" if you don't have access to MLS.

Grand Vizier's picture

You take Zestimates seriously?  Good luck with that...  Honestly, is this Amateur hour?  You need to get over your "Smartest Man in The Room" syndrome...

spartan117's picture

See below MLS figures, asswipe.  I might not be the smartest man in the room, but you sure look like the biggest idiot.

Grand Vizier's picture

Touch a nerve, smart man???  Come, dazzle us with more of your wit and common sense... 

spartan117's picture

It seems it is I who may have "touched a nerve".  Underwater on your home?  Purchased "investment property" you can't rent out for positive ROI?  Why even respond to me if you haven't been agitated by my posts? 

 

Grand Vizier's picture

Yup, you got me pegged!  LOL 

Rentier's picture

totally depends on where you are, the rents on my rentals(all mine are upper scale rents...SS appliances and such) have all gone up.  Also, the demand for rentals has gone way way up.  Had one up for rent in late July and had 12 calls within 2hrs of listing it on a Sunday on Craig's list.

i love cholas's picture

@Spartan,

Depends on what part of so. cal. Rents are def. ticking up in SD

optionsoptions's picture

Rents are up in the Tampa Bay area.

 

And yes, I have access to MLS

spartan117's picture

Here's a partial list of recent price CUTS for homes in the nicer parts of SGV, including Arcadia, Temple City, and Alhambra.  5-10% declines this summer.

MLS:

C11099704

W11056809

A11114558

W11087259

22155469

A11108492

H11072975

 

Rents going up????  Not here! 

 

monopoly's picture

And just gonna sit here and do nothing until the inmates make their useless decisions at 2:15.

Flakmeister's picture

The NAR shills spin things so well that they should hire themselves out as Rotary Oil Rigs....

TruthInSunshine's picture

Fannie, Freddie & the FHA are sitting on about a couple million homes, either directly or indirectly, which they can't sell, so they've begun trying to rent them out (that's how disingenuous NAR is):

 

Gov't Wants to Rent Out Foreclosed Properties
r101958's picture

Compared to 5 years ago.....a statistical blip.

Dr Hackenbush's picture

How is it the NAR is not mutually culpable for the RE bubble again? 

HoardeBilly's picture

What good is real estate? You can't eat it...

fdisk's picture

You cannot eat GOLD as well, but you can rent out

real estate, especially near the Ocean, and collect nice

chunk of change.

plinythehunger's picture

You can also rent out gold.

Spastica Rex's picture

I think there's some renting going on in gold, too.

DosZap's picture

http://apnews.myway.com/article/20110921/D9PSSQQ80.html

The 50 yr Old, Plan......................and possibly more bond purchases.

 

HCSKnight's picture

Really, just how different is the NAR/housing industry from the Fed/Wall Street machine or politicians?

All three were on the same lying team that made the three legs of the housing bubble stool. (pun intended)

fdisk's picture

GOLD keep dropping, not looking good on H4,

Another $50 drop zooming in.

Kina's picture

Yep, the banksters selling make believe gold. China is laughing.

Kina's picture

NAR- are they emabarassed to show their face in public?

The figures quite obviously total bullshit. These guys are saying black is white and expect everybody to think they believe what they are sayin.

Then again, why not, every other body remotely connected with US banking, economy, regulators and politics is entirely corrupt.

 

 

shazbotz's picture

Probably all homes that were marked down under $100k

 

 

adr's picture

Well a sale to the bank counts as a real estate transaction as recorded in my local paper. The bank selling the home to the government counts as a sale as well.

I have seen the same home go back and forth multiple times in a single year in my neighborhood. From Owner to the bank, from the bank to Fannie, from Fannie to a speculator trust, and then back to another bank, then back to Fannie. Five sale contracts in less than a year for a single house which just so happens to be two doors down from me. Nobody has lived there for over a year.

I wonder how many "sales" can be accounted for with this type of BS.

Village Smithy's picture

You got it my man! The banks are who is selling now. The robo signing freeze is over.

DonBadajoz's picture

As usual, with "Good" news the market is down...

animalfarm1984's picture

I number of houses were bought with corruption cash especially China.  It seems like China is supporting not only Europe but USA.

Tsar Pointless's picture

Dozens of houses for sale in my area, none moving.

Everybody wants out, but they can't leave.

Amerikkka is becoming "Hotel California". Don Henley was a genius!

litoralkey's picture

I actually believe that NAR is correct on the market activity increase, but who knows if they have the scale correct.

It's the RRE equivalent of the Dow 30,000 frenzy before the equities bubble burst in 2007.

P.T. Barnum would explain this month as "Peak Sucker".

If everyone knew how and when to catch a falling knife there would be no losers.  If there were no losers, there would be no winners.

Those who bought in August are not going to be the winners.