Housing data ‘may’ have understated extent of collapse

In Data, News on February 22, 2011 at 5:40 am

The National Association of Realtors is reporting that they may have “overstated home sales by as much as 20 percent” dating as far back as 2007.

This comes as no surprise because it has been in their best interest to present a better than normal picture of the real estate market that they represent. It seem that only after four consecutive years of being called out by California real estate analysis firm, CoreLogic, did NAR admit that they ‘may’ have made an error.

Unfortunately, the biggest tragedy here is Reuters shoddy reporting in which they say:

The crash of U.S. housing markets, in part because of shoddy lending practices, was at the heart of the economic meltdown that started in the United States and spread around the world.

As we know, the shoddy lending practices were a symptom of the meltdown — not the cause of the problem, the causes having been well documented, as the US Federal Reserve keeping the interest rate artificially low in support of a misguided federal housing policy, lack of meaningful discretion by Fannie Mae and Freddie Mac, complete lack of regulation of syndicated mortgage market, and the fraudulent or negligent participation of the rating agencies who duped the market and fueled the appetite.

The shoddy lending practices were a part of the system, but even the worst mortgage originators, merely ordered a drink at the bar that was staffed by the Federal Reserve and Fannie Mae, supplied with an unending supply of money from investors who were being led to the party by Moodys and the major investment banks.

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