Did your heart just skip a beat? Where did THIS come from?
DON’T LET IT WORRY YOU!
This was the headline in many papers (NY Times, Wall Street Journal, The News Tribune, etc.) after a report on February 21, 2018, from the National Association of Realtors (NAR).
The headline for the NAR article was different: Existing-Home Sales Slip 3.2 Percent in January.
Newspapers took one sentence out of the article; NAR uses the statistic as their headline.
Here is the link: Link to Article from NAR.
I went on to research how these statistics were created and, more importantly, what did similar statistics look like for PIERCE COUNTY.
Here is how the statistics of these two headlines were created:
- Take the closings from December and then from January, for each of the last 3 years.
- TOTAL decrease from December, 2015 to January, 2016? December, 2016 – January,2017? December, 2017 – January, 2018?
- Then, what years had the “sharpest drop”?
- Nationally, Lawrence Yun, chief economist at NAR says it was this November, 2017 – January, 2018 year ~ compared to the past 3 years. This is a NATIONAL statistic, existing-home sales “sank 3.2% in January from 5.56M Sales in December, 2017 to 5.38M Sales in January, 2018”.
Now, let’s look locally! Would those same headlines be accurate for Pierce County?
|December Closing vs. January Closings||% Change in Home Sales|
|Dec. 2015-Jan 2016||-28.2%|
|Dec 2016-Jan 2017||-20.7%|
|Dec 2017-Jan 2018||-25.3%|
As you can see, the statistics are VERY different for PIERCE COUNTY than for the Nation as a whole. And, actually our numbers are much lower, December over January, year to year. This is what these same headlines would read if it were talking about PIERCE COUNTY:
“Home Sales Post their Sharpest Drop in Two Years”
“Existing-Home Sales Slip 25.3 Percent in January”
Very different ~ And, much wider spread! And, this is what our local market looks like, year-over-year. What does it mean?
In order for a house to SELL in January, the home would go under contract in November-December, because of the time it takes for a home and it’s buyers to go through the process. Guess people are doing other things during that time of year! Housing takes a back-burner!
Most Importantly: How do these statistics correlate to the market as a whole for the year? Is this any indication?
It turns out there is NO correlation to the market for the year as a whole. Let’s look at more statistics:
January – December
Total # of Closings
In other words, relax! The headlines that were promoted this week have NO correlation to the market as a whole. It is taking one small snippet of information, creating a heart-skipping headline, and, frankly making folks worry. There is constant talk of another “housing bubble”and any news like this is fuel for their fire. I will go on, in other posts, to continue to share statistics that will show you the difference in our market today vs. early 2000’s. Not to worry about that!
As you see, I love the research! I love making headlines make sense for you! I love making sure you have accurate knowledge about OUR marketplace!
Let me know if you have ANY questions!
~ Rae Anne