Official existing home sales statistics to be revised downward

The National Association of Realtors announced that existing home sales figures for recent years will be rechecked and revised downward after some errors in counting were discovered:

Data on sales of previously owned U.S. homes from 2007 through October this year will be revised down next week because of double counting, indicating a much weaker housing market than previously thought.

The National Association of Realtors said a benchmarking exercise had revealed that some properties were listed more than once, and in some instances, new home sales were also captured.

“All the sales and inventory data that have been reported since January 2007 are being downwardly revised. Sales were weaker than people thought,” NAR spokesman Walter Malony told Reuters…

Early this year, the Realtors group was accused of overcounting existing homes sales, with California-based real estate analysis firm CoreLogic claiming sales could have been overstated by as much as 20 percent.

So if you thought the existing real estate market was in bad shape in recent years, it was actually worse than you thought. However, it will be interesting to see how much these statistics are revised and then how these changes affect things like the stock market. A little change may not matter much.

This is a reminder about trusting “official” figures too much. On one hand, it would be hard for the average citizen to gather this information. Therefore, we have to trust certain data sources. On the other hand, official measurements can be affected by a variety of factors and always should be considered probabilistic since they are often based on surveys and not 100% counts or “proof.”

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