So How Weak Are Housing Sales?

Peter Coy

John Burns Real Estate Consulting in Irvine, Calif., says new home sales are worse than the Census Bureau says. Here's an excerpt from the company's newsletter, which came out today:

Relying on data without understanding the methodology can lead to wrong conclusions. For example, the Census Bureau is reporting that new home sales are only down 6% from one year ago, which we know is incorrect. For accurate new home sales estimates, see the press releases of publicly traded home builders – all of whom are reporting sales (orders) that are down 20% - 40% from one year ago. The NAHB Housing Market Index, as well as almost every industry source we contact each month, supports the fact that sales are down 20%+ from one year ago in more than 70% of the markets we track (Texas, the Carolinas, Georgia and New Mexico are some of the major exceptions).