By The Tim on October 11th, 2009 at 3:58 PM · 48 Comments
In case there is any doubt about whether NAR chief “economist” Lawrence Yun is just as much of a shameless price-boosting shill as his predecessor David Lereah, I present some excerpts from a post he made on Friday regarding the inefficient, expensive, and economically stupid homebuyer tax credit: Unleashing Pent-Up Housing Demand and Sustainable Economic Recovery
There is no delight in watching the budget deficit soar. The $1.4 trillion deficit in the completed 2009 fiscal year to September is the highest ever in the U.S. in sheer dollar figures, and the highest since the Second World War if measured in relation to the overall economic pie. It’s a huge burden to the future generation and could easily cause interest rates to rise much sooner and quite sharply. Washington needs to come out with a credible plan to reduce the deficit over time.
However, one area where federal taxpayer dollars have effectively been utilized is in providing a homebuyer tax credit. The key to any future sustainable economic recovery lies in home values stabilizing or, better yet, a return to a historical appreciation rate of 3 to 5 percent each year. The bubble prices crash landed. All the excesses have already been removed. In fact, one could legitimately argue that home values have overshot downward.
…
It would be an utter pity if the housing market, just at the cusp of self-sustaining recovery, rolls downhill again. That could indeed happen if potential buyers step back and inventory again climbs. Falling home values – independent of whether overcorrecting is happening or not – will bring back all the associated collateral damage.
A much happier scenario would be that the buying momentum continues for few additional quarters such that inventory falls back down to the normal 5 to 7 months, a level consistent with home value stabilization. Once that is accomplished, the consumer “fear factor” of waiting and waiting for a lower price later down the road will no longer be part of home buying decision.
…
For that happy scenario to play out, a time extension on the home buyer tax credit is critically needed.
Unfortunately the full post is available only to registered members of the real estate professional’s social network ActiveRain. If you for some reason have a desire to read the whole thing, drop me an email and I can email it to you.
Categories: News
Tags: economy, government_meddling, NAR, tax credit, Yun
Discredited NAR mouthpiece Lawrence Yun paid Seattle a visit on Friday to spout some more of his trademark wish-based forecasting. The Puget Sound Business Journal and the P-I both had brief write-ups of his presentation.
From Aubrey Cohen’s write-up in the P-I:
“We believe that the home prices have already fallen to what could be justifiable,” economist Lawrence Yun said, noting that mortgage payments for a typical household buying a typical house last year were back to 1998 levels, as a percentage of income.
“One may even argue that home prices are underpriced,” he said, because that calculation was based on higher interest rates than current rates.
This statement is so bizarre and nonsensical it’s hardly even worth refuting. As a number of readers pointed out over in the forums, Yun appears to be using national stats for income and home prices, which causes income to be skewed high by the cities (where home ownership levels are lower) and home prices to be skewed low by the rural regions.
Here in the Seattle area, the affordability index—which is calculated using local home prices and local incomes—is still well below its historical level. As I explained in Bottom-Calling: Affordability Index Forecast, home prices will have to fall roughly 40% from their peak to get us back in line with a level that “could be justifiable.” As of January, prices had fallen just over 20% from the peak. So we’re about halfway there.
(Aubrey Cohen, Seattle P-I, 02.27.2009)
(Kirsten Grind, Puget Sound Business Journal, 02.27.2009)
Categories: News
Tags: Business Journal, Cohen, Grind, NAR, Seattle_PI, Yun
By The Tim on June 11th, 2008 at 11:11 AM · 29 Comments
Remember about four months ago, when NAR Chief “Economist” Lawrence Yun said this?
You may even say Seattle is underpriced if you believe Seattle is becoming a superstar city. Seattle is underpriced in relation to other West Coast markets.
Well, it seems he has changed his tune ever so slightly. Here’s a more recent quote, from a Forbes article on Monday (emphasis mine):
Yun described the trend [of declining home prices] as a “positive” noting that the areas with recovering planned sales also have high rates of foreclosure. In contrast, sales in areas such as Austin, Nashville and Seattle, where home prices peaked a year ago and continue to hang on, there is no market recovery in sight. Yun said: “Buyers are simply unable able to afford these higher prices.”
Wow. That’s quite a turnaround. I wonder what changed Mr. Yun’s mind?
(Maurna Desmond, Forbes.com, 06.09.2008)
Categories: News
Tags: NAR, propaganda, Seattle_is_special, Yun
By The Tim on February 8th, 2008 at 3:15 PM · 51 Comments
Apparently the only necessarily qualification for becoming a “world class” or “superstar” city is to keep on repeating that it is so. That’s the message I’m getting from the latest quotes from the Realtor’s spokesman Lawrence Yun, anyway.
Seattle-area home prices are manageable for typical workers, according to the chief economist for the National Association of Realtors.
“You may even say Seattle is underpriced if you believe Seattle is becoming a superstar city,” Lawrence Yun told area brokers in Bellevue on Thursday. “Seattle is underpriced in relation to other West Coast markets.”
First off, we have addressed this “superstar” or “world class” thing before. If you haven’t read it already, take the time to check out On Luxury Cars and World Class Cities. Also be sure to read P-I columnist Bill Virgin’s take on the world class question. The gist of our argument is that although Seattle is great, and we love it here (really we do), it is not a world class city by any available objective measure. Sorry, it’s just not, and repeating over and over again that it is doesn’t make it so.
When people like Mr. Yun make the assertion that Seattle is a “superstar city,” they never back that claim up with any sort of quantifiable data. There are measurable characteristics that one can use to judge whether or not a city is world class (a good list can be found on Wikipedia), and Seattle simply does not measure up, any way you look at it.
But that’s not my only problem with Mr. Yun’s speech yesterday. He also made a some verifiably false assertions and ludicrous predictions. [Read more →]
Categories: Features · News
Tags: fundamentals, NAR, propaganda, Seattle_is_special, Yun
