Convenient Truths

Chris Palmeri

"Facts all come with points of view, facts don't do what I want them to," the band Talking Heads once sang. I'm reminded of those lyrics when I read recent reports about the housing markets. Closely-watched releases like the National Association of Realtors report on existing home sales that came out on Tuesday can send shivers through the financial markets. But more often than not they just leave folks scratching their heads. Sales are down, but prices are up? What does that mean? In their quest to interpret such data, reporters and analysts often choose whatever number best illustrates the point they want to make. BusinessWeek Online reader Frank Pecarich notes how one Sacramento writer highlighted the number of homes on the market as being the highest since the early 1990s, but failed to say that the population has grown since then. As a percentage of the market, those inventory numbers might not be that bad. Another one to watch out for as housing prices slow, many markets are still reporting year over year increases in prices. But in some cases those same prices have declined in recent months. The big picture clearly shows the real estate market slowing. Right now though it looks much more like a soft landing than a crash.