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Last Update: 21-Dec-11 10:41 ET
Existing Home Sales Increase Following Massive Downward Revisions
Existing home sales increased from 4.25 mln in October to 4.42 mln in November, an increase of 4.0%. The Briefing.com consensus expected sales to increase by 1.2%.
(Please Note: The consensus forecast of 5.03 mln did not account for the downward revisions. The cosensus did, however, correctly expect sales increased in November.)
The increase in sales in November was in-line with the 9.2% increase in mortgage purchase applications and a 10.4% increase in the Pending Home Sales Index.
The National Association of Realtors announced that it over counted home sales in many regions from 2007 through November 2011. This resulted in an average drop of 14.3% in sales each month over that time period.
To put this in perspective, sales in 2010 were revised down from 4.908 mln to 4.190 mln.
The effects of the revisions are not isolated to the sales numbers. The BEA relies on the existing home sales figure for their estimates for realtor fees. The revisions will cause the BEA to lower their realtor fee portion of GDP every quarter through 2007.
(Please Note: The consensus forecast of 5.03 mln did not account for the downward revisions. The cosensus did, however, correctly expect sales increased in November.)
The increase in sales in November was in-line with the 9.2% increase in mortgage purchase applications and a 10.4% increase in the Pending Home Sales Index.
The National Association of Realtors announced that it over counted home sales in many regions from 2007 through November 2011. This resulted in an average drop of 14.3% in sales each month over that time period.
To put this in perspective, sales in 2010 were revised down from 4.908 mln to 4.190 mln.
The effects of the revisions are not isolated to the sales numbers. The BEA relies on the existing home sales figure for their estimates for realtor fees. The revisions will cause the BEA to lower their realtor fee portion of GDP every quarter through 2007.
